Bank of America Securities analyst Ebrahim Poonawala maintained a Buy rating on Citigroup yesterday and set a price target of $120.00.
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Ebrahim Poonawala has given his Buy rating due to a combination of factors surrounding Citigroup’s strategic initiatives and financial outlook. The recent executive changes and reorganization of business segments under CEO Jane Fraser are seen as a natural progression in Citigroup’s ongoing turnaround efforts. These changes are expected to enhance strategic flexibility, particularly in the wealth and cards businesses, and could potentially lead to an exit from regulatory consent orders, further boosting the bank’s strategic options.
Moreover, Poonawala highlights Citigroup as offering the best risk/reward profile among large-cap banks, with significant re-rating potential over the next few years. The bank’s stock appears under-owned by institutional investors, suggesting room for growth. The reorganization, including the integration of the retail deposit franchise into the wealth segment, is anticipated to sharpen the wealth strategy, aiding in client acquisition and growth of investment assets. Additionally, the timing of the CFO transition is considered logical, aligning with upcoming strategic target updates, and the new CFO’s extensive experience is expected to support the bank’s growth trajectory.
In another report released on November 19, Oppenheimer also maintained a Buy rating on the stock with a $120.00 price target.