Stock price when the opinion was issued
A story of going from very bad to less bad to good. Selling assets. Trades ~7x, in line with other banks. But growing around 24% CAGR over the forecast horizon 2025-27. Beneficiary of the new Trump trade combined with cost cuts. More growth than either JPM or BAC. Yield is 3%.
Own in a registered account.
He's trying to play a quiet offence when he's a bit scared of the markets and tariffs. Cheap, tethered, and insulated. Financials really get a bid from Trump -- tax cuts, less regulation, lots more M&A. Yield curve looking a lot better, upward sloping. Beat Q4, earnings up 40%. Investment banking and market revenue also up. Company's expecting ROE to improve to 10-11% in 2026. Trades under 9x. Very favourable risk/reward. Yield is 2.7%, decent.
Reducing global presence by exiting unprofitable businesses is really helping earnings by lowering costs.
Owns several US banks. The yield curve is steepening and the regulatory backdrop is now more favourable to the banks. The post-2008 safeguards have built huge capital in these banks and is starting to be released. Citi trades at a 24% discount to tangible book value which will compress and catch up to peers.
(Analysts’ price target is $90.30)