On Monday, Oppenheimer maintained an Outperform rating on shares of Citigroup Inc. (NYSE:C) and increased the price target to $86.00 from $85.00. This change follows the company's release of its second-quarter 2024 earnings, which surpassed analyst expectations.
Citigroup reported earnings per share (EPS) of $1.52 for the second quarter, exceeding both Oppenheimer's estimate of $1.34 and the consensus estimate of $1.39. The earnings included a notable gain of approximately $400 million from Visa (NYSE:V), contributing roughly $0.10 per share to the EPS.
When excluding this one-time gain, the financial results were deemed to align closely with initial expectations, with only slight variations observed throughout the profit and loss statement.
The core pre-provision earnings (PPE) for Citigroup stood at $6.6 billion, modestly surpassing Oppenheimer's forecast of $6.4 billion. This figure represents an 11% year-over-year increase, following a 6% rise in the first quarter of the year.
The bank has now reported its fourth consecutive year-over-year increase in PPE, marking a significant improvement over the previous trend of seven out of ten quarters showing negative results.
The early years saw a substantial reduction in PPE, nearly a quarter, according to the analyst's commentary. Still, the latest financial disclosures suggest a turnaround for Citigroup, with the current figures reflecting a minor but positive deviation from prior estimates. The updated price target reflects confidence in the bank's ongoing performance and trajectory.
This revision of the price target by Oppenheimer signals a positive outlook for Citigroup's stock, as the bank continues to navigate the financial landscape and deliver results that meet or exceed analyst and market expectations.
In other recent news, Citigroup Inc. has reported strong Q2 results, with adjusted earnings surpassing consensus estimates and a net income of $3.2 billion. The company's earnings per share increased to $1.57, up from the previous year's $1.33. Citigroup also projected revenues between $80 billion and $81 billion for 2024, suggesting a 4% growth from the 2023 figures.
Following these results, Argus raised the price target for Citigroup shares to $72, while BMO (TSX:BMO) Capital Markets adjusted its price target from $65 to $67. Evercore ISI maintained its 'In Line' rating, with a price target of $62. The company also announced an enhancement in shareholder returns, increasing its quarterly dividend by 6%, and added approximately $1 billion to its third-quarter buyback guidance.
While Citigroup continues its ongoing restructuring efforts, the company faces regulatory scrutiny from the Federal Reserve and the OCC related to 2020 consent orders. These are among the recent developments concerning Citigroup Inc.
InvestingPro Insights
As Citigroup Inc. (NYSE:C) garners attention from Oppenheimer with an updated Outperform rating, insights from InvestingPro can provide additional context to the bank's financial health and market performance. With a market capitalization of $123.09 billion, Citigroup stands as a prominent player in the banking industry. The company's P/E ratio is currently at 17.88, which has adjusted to 16.14 over the last twelve months as of Q2 2024, indicating a potential undervaluation compared to earnings.
InvestingPro Tips suggest that Citigroup has maintained dividend payments for 14 consecutive years, with a dividend yield of 3.29% as of the last dividend date, reflecting a steady return to shareholders. Moreover, despite concerns over weak gross profit margins, the bank is trading near its 52-week high, with a price that is 96.33% of this peak. Analysts have revised their earnings downwards for the upcoming period, which is an important consideration for investors monitoring the bank's profitability outlook.
For those looking to delve deeper into Citigroup's performance metrics and gain access to more InvestingPro Tips, visit https://www.investing.com/pro/C. Remember, you can use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. There are 6 additional InvestingPro Tips available that could provide further guidance on Citigroup's stock potential.
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