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Valued at a market cap of $134.3 billion, Citigroup Inc. (C) operates as one of the largest financial institutions in the world. The New York-based financial giant focuses on safeguarding assets, lending money, making payments and accessing the capital markets on behalf of its clients. Its customers include corporations, governments, institutions, as well as individuals. It is expected to announce its Q4 earnings before the market opens on Wednesday, Jan. 15.
Ahead of the event analysts expect Citigroup to report an adjusted profit of $1.23 per share, up a massive 46.4% from $0.84 per share reported in the year-ago quarter. Furthermore, the company has a robust earnings surprise history. It has surpassed analysts’ bottom-line estimates in each of the past four quarters. Its adjusted EPS for the last reported quarter dipped marginally to $1.51 but exceeded analysts’ expectations by a notable 12.7%.
For fiscal 2024, analysts expect Citigroup to report an adjusted EPS of $5.88, up 4.3% compared to $5.64 in fiscal 2023. Meanwhile, in fiscal 2025, its earnings are expected to surge by a staggering 22.6% year-over-year to $7.21.
Citigroup’s stock prices have soared over 36.8% in the past 52 weeks, outperforming the Financial Select Sector SPDR Fund’s (XLF) 28.4% surge and the S&P 500 Index’s ($SPX) 23.8% gains during the same time frame.
Despite reporting better-than-expected results, Citigroup’s stock prices fell over 5.1% in the trading session after the release of its Q3 earnings on Oct. 15. It reported a marginal growth in total revenues (net of interest expenses) to $20.3 billion which exceeded Wall Street’s expectations by a notable 2.1%. Citigroup has continued to observe robust growth in its investment banking division which delivered a strong 31.4% growth in revenue to $934 million. Meanwhile, its securities services revenues surged nearly 24% year-over-year to $1.4 billion. The company has also reported a notable 1.9% decline in operating expenses to $13.3 billion.
However, the company increased its provisions for credit losses and for benefits and claims by a massive 45.4% compared to the year-ago quarter to $2.7 billion. This severely impacted Citi’s profitability leading to a sharp 8.7% decline in net income to $3.2 billion.
The consensus opinion on Citigroup stock is moderately bullish with an overall “Moderate Buy” rating. Out of the 19 analysts covering the stock, 10 recommend “Strong Buy,” two advise “Moderate Buy,” and seven advocate a “Hold” rating. Its mean price target of $79.45 represents a 12.9% premium to current price levels.
