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Investing.com - BofA Securities raised its price target on Citi (NYSE:C) to $100 from $89 while maintaining a Buy rating on the stock. Currently trading at $83.78, near its 52-week high of $84.74, Citi’s stock has delivered a 39.47% return over the past year. The price target increase reflects growing confidence in CEO Jane Fraser’s strategic turnaround efforts initiated in 2022. According to InvestingPro analysis, Citi appears undervalued based on its Fair Value metrics.
BofA Securities views Citi’s transformation as "among the most complex in the corporate world" but believes the bank now has "a fighting chance of becoming competitive." The firm cited several specific actions taken under Fraser’s leadership that support its optimistic outlook. With a market capitalization of $156 billion and a P/E ratio of 12.88, Citi remains a significant player in the banking sector.
These strategic initiatives include Citi’s exits from international consumer markets, balance sheet de-risking efforts, and increased investments in technology and personnel. BofA also highlighted the bank’s business streamlining and recruitment of external talent as positive factors.
The price target adjustment comes as investors have repeatedly questioned whether the current turnaround attempt would yield different results than previous efforts. BofA’s analysis suggests Fraser’s comprehensive approach differentiates this restructuring from past attempts.
The firm maintained its Buy rating on Citi stock, indicating continued confidence in the bank’s direction despite acknowledging the significant challenges involved in its transformation journey.
In other recent news, Citigroup has announced significant developments that could impact investors’ perspectives. The company is set to cut approximately 3,500 jobs at its technology centers in Shanghai and Dalian, China, as part of a strategy to streamline global technology operations and improve risk and data management. Additionally, Citigroup has partnered with Carlyle Group (NASDAQ:CG) to provide asset-backed financing to fintech lenders, a growing segment in the private credit market. This partnership aims to meet the increasing demand for scalable financing solutions from fintech companies. In a regulatory shift, Citigroup has removed restrictions on banking services to retail clients selling firearms, responding to recent regulatory changes and ongoing discussions about fair access to banking services. Furthermore, Citigroup is involved in preliminary discussions with major U.S. banks, including JPMorgan Chase (NYSE:JPM) and Bank of America, about issuing a joint stablecoin to address competition from the cryptocurrency sector. These discussions, still in the early stages, suggest a potential move towards a more regulated digital currency option.
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