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New York-based Citigroup Inc. (C) is a globally diversified financial services holding company that provides a range of financial products and services such as consumer banking and credit, corporate and investment banking, securities brokerage, trade and securities services, and wealth management to consumers, corporations, governments, and institutions. With a market cap of $120.93 billion, the company operates through five segments: Services, Markets, Banking, U.S. Personal Banking, and Wealth.
Shares of this investment banking giant have outperformed the broader market considerably over the past year. C has gained 39.9% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 27.2%. In 2024 alone, C stock is up 23.6%, surpassing the SPX’s 10% rise on a YTD basis.
Zooming in further, C’s outperformance looks more pronounced compared to S&P Bank ETF SPDR (KBE). C has comfortably outperformed the exchange-traded fund’s 3.5% YTD returns.
In March, C ended the organizational simplification exercise it embarked on last year. To increase shareholder return, it sold its non-U.S. consumer businesses in nine out of 14 regions and majorly shut down three more businesses. It reduced management layers to eight from 13 and simplified its structure into five businesses. The bank also wants to list its Mexican consumer banking unit Banamex through an IPO in 2025.
In its efforts to increase profits, the company announced plans to cut 20,000 jobs or nearly 10% of its global workforce, over the next two years. C’s outperformance this year can be majorly attributed to these simplification, divestiture, and cost containment measures.
For the current fiscal year, ending in December, analysts expect C to report an EPS growth of 6% to $5.98 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 22 analysts covering C stock, the consensus rating is a “Moderate Buy.” That’s based on 11 “Strong Buy” ratings, one “Moderate Buy,” and 10 “Holds.”
This configuration is slightly more bullish than three months ago, with nine suggesting a “Strong Buy.”
Recently, Keefe, Bruyette & Woods analyst David Konrad maintained a “Market Perform” rating on C stock and raised the price target from $54 to $66, implying a potential upside of 3.8% from current levels.
The mean price target of $65 represents a 2.2% premium to C’s current price levels. The Street-high price target of $86 suggests an ambitious upside potential of 35.2%.
On the date of publication, Dipanjan Banchur did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
