Wells Fargo reiterates Citi as top bank pick after CEO meeting

Wells Fargo analyst Mike Mayo says a meeting with Citi (C) CEO Jane Fraser reinforced that valuation creation is coming soon. Citi is “on the cusp of transitioning from a value destruction and to value creation” and the stock should trade from below to above tangible book value, the analyst tells investors in a research note. Wells says Citi’s capital should allow for faster buybacks post the late-June Federal Reserve stress test. In addition, the bank’s credit quality on cards reflects declining delinquencies, and the corporate structure is a “game changer” that creates new accountability in its five lines of business, the firm adds. Citi remains Wells Fargo’s number one bank pick with an Overweight rating and $110 price target