Is Citigroup Inc. (NYSE:C) the Most Profitable Value Stock to Buy Now?

Is Citigroup Inc. (NYSE:C) the Most Profitable Value Stock to Buy Now?

  • 18.03.2025 13:09
  • msn.com
  • Keywords: Growth, Value Investing

Citigroup Inc. (NYSE:C) is highlighted as a profitable value stock, ranked fourth on a list of top performers with a forward P/E ratio of 9, driven by strong revenue growth and market share gains in its services segments.

Meta ServicesMETAsentiment_neutralDISsentiment_neutral
open_in_newOriginal article

Estimated market influence

Citigroup Inc.

Positivesentiment_satisfied
Analyst rating: N/A

The article discusses Citigroup Inc.'s position as a profitable value stock, highlighting its TTM net income of $12.682 billion and forward P/E ratio of 9.

Powers Advisory Group

Positivesentiment_satisfied
Analyst rating: N/A

Highlighted by Matt Powers, Managing Partner at Powers Advisory Group, as part of the shift towards value investing.

Meta Platforms

Meta Platforms

Neutralsentiment_neutral
Analyst rating: Strong buy

Mentioned in a quote from Diamond Hill Capital Long-Short Fund's Q1 2024 report as one of their top contributors, but no specific impact on Citigroup or the broader market is discussed.

Walt Disney

Walt Disney

Neutralsentiment_neutral
Analyst rating: Buy

Mentioned in a quote from Diamond Hill Capital Long-Short Fund's Q1 2024 report as one of their top contributors, but no specific impact on Citigroup or the broader market is discussed.

Hedge Funds

Positivesentiment_satisfied
Analyst rating: N/A

The article emphasizes the role of hedge funds in identifying profitable value stocks and their influence on investment trends.

Context

Analysis of Citigroup Inc. (NYSE:C) as a Profitable Value Stock

Overview

  • Citigroup Inc. (NYSE:C) is highlighted as one of the most profitable value stocks based on its forward P/E ratio of 9 and TTM net income of $12.682 billion.
  • The stock ranks 4th in a list of profitable value stocks, selected using criteria such as hedge fund holdings (101) and analyst sentiment.

Market Trends

  • Shift to Value Investing: Investors are moving away from growth stocks towards value and dividend-focused strategies, driven by factors like policy uncertainty and market fatigue.
  • Performance Comparison:
    • Dividend ETFs: Up 5% year-to-date.
    • Large-cap growth funds: Down 6% year-to-date.
    • Tech-heavy portfolios dominate large-cap growth funds (nearly 50% of holdings).

Competitive Landscape

  • Diversification Benefits: Dividend-focused funds, including Citigroup, offer broader sector exposure (healthcare, financials, staples) compared to concentrated tech-heavy portfolios.
  • Hedge Fund Sentiment: Citigroup is held by 101 hedge funds, reflecting strong institutional interest.

Strategic Considerations

  • Revenue Growth: Citigroup achieved a 9% YoY revenue increase in 2024 ($19.6 billion), despite a low-interest-rate environment.
  • Focus Areas:
    • Treasury and Trade Solutions (TTS): Market share gains, driven by US dollar clearing, cross-border transactions, and assets under custody.
    • Digital Investments: Emphasis on technology and platform modernization to strengthen relationships with asset managers.

Long-Term Effects

  • Growth Potential: Citigroup’s restructuring efforts and expected expense reductions in H2 2024 position it for sustained profitability.
  • AI vs. Traditional Banking: While the article acknowledges Citigroup’s growth potential, it highlights AI stocks as a shorter-term high-return alternative.

Regulatory Impacts

  • Ongoing regulatory issues and capital building efforts indicate a focus on compliance and long-term stability.

This analysis underscores Citigroup’s strong financial performance and its position as a key player in the value investing space, with strategic initiatives poised to drive future growth.