Skip to main content

Market Overview

Here's Why The Bullish Case For Citigroup's Stock Can Now Be Made

Here's Why The Bullish Case For Citigroup's Stock Can Now Be Made

Down more than 15 percent since peaking in late January, shares of Citigroup Inc (NYSE: C) should now be bought, according to Deutsche Bank.

The Analyst

Deutsche Bank's Matt O'Connor upgraded Citigroup from Hold to Buy with a price target lifted from $74 to $76.

The Thesis

Citi's stock weakness since January likely reflects multiple factors, O'Connor said in a note. These include rising U.S. rates, a strengthening U.S. dollar, trade uncertainty, ongoing mixed trends in credit card usage, and slower than expected improvements in management's efficiency efforts.

Over the past few weeks, however, multiple positive developments and removal of overhangs has been made clear, the analyst said.

  • Management extended and re-negotiated its right to retain ownership of Sears' (NASDAQ: SHLD) card portfolio where 70 percent of the volume comes from outside of the retailer.
  • A seven-month long promotional offer related to the Costco (NASDAQ: COST) card has come to an end which should help boost margins.
  • Management confirmed all of its big card partners are signed through at least 2022.
  • Management reiterated its 2018 efficiency ratio at or slightly above 57 percent and expectations for a low 50s efficiency ratio in 2020 isn't priced into the stock today.
  • Management's commitment to return at least $20 billion of capital per year represents 12 percent of its market cap which makes it among the largest capital return stories among big banks.

Price Action

Shares of Citigroup were trading around $67.30 Wednesday afternoon.

Related Links:

A Concerning Weakness In Bank Stocks

What's The Volcker Rule, And Why Are Banks Celebrating The Fed's Proposed Changes?

Latest Ratings for C

Apr 2021Argus ResearchMaintainsBuy
Apr 2021Morgan StanleyMaintainsOverweight
Apr 2021JefferiesMaintainsBuy

View More Analyst Ratings for C
View the Latest Analyst Ratings


Related Articles (C)

View Comments and Join the Discussion!

Posted-In: banks credit cards Deutsche Bank Matt O'ConnorAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

Latest Ratings

ATUSMorgan StanleyMaintains36.0
AQNMorgan StanleyMaintains16.5
AEPMorgan StanleyMaintains104.0
AEEMorgan StanleyMaintains87.0
LAZRB of A SecuritiesInitiates Coverage On
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at