Citigroup’s Growth Potential and Stability: Buy Rating Reaffirmed Amid Effective Cost Management and Share Buyback Acceleration

Analyst Ebrahim Poonawala of Bank of America Securities reiterated a Buy rating on Citigroup (C – Research Report), retaining the price target of $89.00.

Ebrahim Poonawala has given his Buy rating due to a combination of factors that highlight Citigroup’s potential for growth and stability. The company has demonstrated positive operating leverage for the third consecutive quarter, with expenses coming in below expectations, which indicates effective cost management. Additionally, Citigroup’s share buyback program is accelerating, with buybacks exceeding management’s initial guidance, and there is potential for further acceleration in the latter half of the year following the results of the Federal Reserve’s stress test.
Despite some investor concerns regarding credit risk and revenue defensibility, Poonawala believes that these risks are perceived rather than actual. The management team, led by CEO Jane Fraser, has effectively navigated past challenges, and the current valuation of the stock presents an attractive opportunity. Furthermore, a more balanced regulatory environment could enhance capital flexibility, supporting increased share buybacks and investment spending. These factors contribute to the reaffirmation of the Buy rating and a price objective of $89.

In another report released today, Barclays also maintained a Buy rating on the stock with a $95.00 price target.

Based on the recent corporate insider activity of 76 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of C in relation to earlier this year.