Evercore ISI raises Citizens Financial target to $43

On Tuesday, Evercore ISI analyst John Pancari updated the price target on Citizens Financial Group (NYSE:CFG) shares, increasing it to $43.00 from the previous $40.00 while keeping an In Line rating. Currently trading at $39.57 with a P/E ratio of 12.56, InvestingPro analysis suggests the stock is undervalued. The adjustment follows management meetings that highlighted a strong earnings trajectory within the commercial banking sector.

The discussions, which took place last week in Boston, involved Citizens’ Head of Commercial Banking, Don McCree; Head of Capital Markets, Ted Swimmer; Chief Risk Officer, Richard Stein; and Investor Relations personnel, Kristen Silberberg and Lovin Thomas. These meetings delved into various aspects of Citizens’ operations, including the expansion of their Private Bank and overall credit risk management. With a market capitalization of $17.16 billion and a notable dividend yield of 4.25%, Citizens Financial has maintained dividend payments for 12 consecutive years, demonstrating strong shareholder commitment.

The analyst noted that the meetings occurred during a period marked by significant financial events such as the ratification of Trump’s tax plan, ongoing tariff negotiations, bond market fluctuations, and a general downturn in market sentiment. Despite a current lull in commercial client activity due to uncertainties around tariffs, market volatility, and rising interest rates, management conveyed optimism. They pointed to a strong capital markets pipeline and anticipated improvement in loan demand once there is more clarity on tariffs and potentially interest rates.

Credit trends at Citizens Financial Group are stable, with management acknowledging possible stress in certain areas like office commercial real estate, but also noting that there are sufficient reserves in place. Additionally, while the Private Bank’s growth remains robust, Citizens is intensifying efforts to utilize Private Bank relationships to expand commercial business.

The report also mentioned that while Citizens is focusing on organic growth, it does not dismiss the possibility of non-bank acquisitions to enhance capital markets and commercial banking capabilities. Whole bank acquisitions are not a current focus, but interest in smaller Private Banking and wealth-oriented franchises in new markets could emerge in the longer term.

Pancari concluded that there is no change to the earnings per share (EPS) estimates for Citizens Financial Group. The raised target price reflects higher sector valuations, and while the In Line rating persists, there is a positive outlook for the stock with anticipation of a more favorable entry point as macroeconomic conditions ameliorate. InvestingPro data reveals analyst targets ranging from $41 to $57, with additional exclusive insights available in the comprehensive Pro Research Report, which provides deep-dive analysis of Citizens Financial Group among 1,400+ top US stocks.

In other recent news, Citizens Financial Group has been the focus of several analyst updates and executive changes. Jefferies initiated coverage on Citizens Financial Group with a Buy rating and a price target of $50, citing the bank’s potential for above-average growth and diverse fee income streams. Meanwhile, RBC Capital Markets adjusted its price target for the company to $44, maintaining an Outperform rating, following the bank’s first-quarter earnings report. The report highlighted a return on common tangible equity of 9.6% and a return on equity of 6.2%, emphasizing the bank’s progress in strategic goals like expanding Citizens Private Bank.

DA Davidson also revised its price target for Citizens Financial Group to $49, maintaining a Buy rating, while noting the company’s ambitious 2025 guidance amidst economic uncertainties. JPMorgan reiterated a Neutral rating with a price target of $43, mentioning the bank’s effective expense management and the challenges posed by global economic conditions. In executive news, Brendan Coughlin has been promoted to President, while John Woods, the Vice Chair and CFO, will leave the company in August 2025.

These developments reflect Citizens Financial Group’s ongoing strategic initiatives and management changes, which are being closely monitored by investors and analysts alike.

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