Citigroup (C) Stock Forecast & Price Target

Citigroup reported a robust revenue growth of 9.4% year-over-year, reaching $16.2 billion, with an even stronger performance excluding the Russia notable item, which showed a 7.7% increase. The bank's guidance for net interest income (NII) ex-markets is projected to grow by 5-6% through 2026, indicating a positive trajectory in earnings, with an expected total NII of $62.5 billion. Additionally, Citigroup has demonstrated a healthy increase in its book value per share, which rose 1.4% sequentially and 8.3% year-over-year, further solidifying the bank's financial health and potential for dividend increases in the near future.

Citigroup's common equity tier 1 (CET1) ratio declined to 13.2%, marking a downward trend from both the previous quarter and year-over-year figures. Additionally, the bank's net income from its markets segment fell significantly by 50% compared to the prior quarter and 22% year-over-year, with substantial decreases in both fixed income and equity markets revenue. Furthermore, the potential economic downturn, driven by rising inflation and policy uncertainty, raises concerns about the deterioration of credit quality, which could negatively impact profitability and increase provisioning requirements.