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Investing.com - Truist Securities raised its price target on Citi (NYSE:C) to $112.00 from $105.00 on Wednesday, while maintaining a Buy rating on the stock. The banking giant, currently trading at $103.83 and approaching its 52-week high of $105.59, has delivered impressive returns with a 73% gain over the past year.
The price target increase follows Citi’s recent conference updates, which included third-quarter capital markets trends and higher fiscal year 2025 revenue and expense guidance compared to previous forecasts. InvestingPro analysis suggests Citi is currently undervalued, with additional insights available through 12+ exclusive ProTips and comprehensive financial metrics.
Truist now models 2026 expenses slightly above $53 billion, up from management’s previous target of "below $52.6b," but still expects expenses to decrease by approximately $500 million year-over-year in 2026.
For 2027, Truist maintains its expectation for total expenses to be flat-to-up modestly, alongside low single-digit revenue growth, with an improving efficiency ratio from 63% in 2025 to 59% in 2027.
The new $112 price target is based on a 9.5x price-to-earnings multiple on Truist’s 2027 EPS estimate of $11.80, which equates to approximately 1.1x their year-end 2026 estimated tangible book value per share versus an estimated return on tangible common equity of 10.9% in 2027. The bank currently trades at a P/E ratio of 15.21x and offers a 2.33% dividend yield, maintaining dividend payments for 15 consecutive years.
In other recent news, Citibank announced a reduction in its base lending rate from 7.50% to 7.25%, effective September 18, 2025. This adjustment is the first change in the bank’s base lending rate since its last modification, potentially impacting borrowing costs for its customers. In terms of earnings, Citi reported strong second-quarter results with net revenue of $21.7 billion, surpassing consensus estimates of $21.0 billion, and earnings per share of $1.96, exceeding the forecasted $1.66. Despite these results, Freedom Capital Markets downgraded Citi’s stock rating from Buy to Hold, although they raised the price target to $108.00 from $77.00.
Conversely, Keefe, Bruyette & Woods reiterated an Outperform rating for Citi, citing positive revenue momentum and the potential to exceed the company’s fiscal year 2025 revenue guidance of $84 billion. Additionally, Citi has entered into a significant partnership with BlackRock, outsourcing $80 billion in client assets to the investment management firm. This move marks the closure of Citi’s last in-house asset management operations, with BlackRock managing assets for thousands of Citi’s wealthiest clients. The collaboration, known as "Citi Portfolio Solutions powered by BlackRock," combines Citi’s strategic investment advisory services with BlackRock’s expertise.
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