Analysts are bullish
The Fed’s pause on interest rate hikes, competitive activity, and tough YoY (year-over-year) comparisons are expected to limit banks’ top and bottom-line growth in the United States. However, analysts still recommend a “buy” on Citigroup (C) stock. Credit offtake, growth in deposits, lower expenses, and share buybacks are expected to support the revenues and earnings.
Among the 28 analysts covering Citigroup, 22 recommended a “buy,” five recommended a “hold,” and one recommended a “sell.” Analysts’ target price of $77.60 per share implies an upside of 18.4% based on its closing price of $65.52 on April 10.
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Citigroup’s ability to drive loans and deposits, improved efficiency ratio, and low valuation make it an attractive bet among major banks. Besides Citigroup stock, analysts are also bullish on Bank of America (BAC) stock. Analysts recommended a “hold” on JPMorgan Chase (JPM), Goldman Sachs (GS), and Wells Fargo (WFC).
So far, Citigroup stock has risen 25.9% in 2019. Citigroup has outperformed its peers and the broader markets in terms of growth. Bank of America, Goldman Sachs, JPMorgan Chase, and Wells Fargo shares have risen 18.0%, 21.5%, 7.9%, and 3.7%, respectively, on a YTD basis as of April 10. The S&P 500 rose 15.2% during the same period.