First Read: Citigroup Inc "13% 1H26 ROTCE notable vs. 10-11% FY guide" (Neutral)

Research evidence excerpt

First Read: Citigroup Inc "13% 1H26 ROTCE notable vs. 10-11% FY guide" (Neutral)

Forecast returns

Forecast price appreciation 6.6%

Forecast dividend yield 1.9%

Forecast stock return 8.5%

Market return assumption 9.3%

Forecast excess return -0.8%

Company Description

Citigroup is a global diversified financial services holding company, with businesses that

provide consumers, corporations, governments, and institutions with a broad range of

financial products and services, including investment banking, corporate banking, retail

banking, retail brokerage, and cash management products and services. Citi has

approximately 200 million customer accounts and does business in more than 160 countries

and jurisdictions, with roughly 240,000 full-time employees.

Valuation Method and Risk Statement

We arrive at our price targets by applying target P/E multiples to our '26/27 EPS estimates,

which is weighted 50%, and target P/TBV multiples to our YE26/27E TBV estimates, which is

also weighted 50%. Primary industry risks include: 1) lower deposit levels due to decreased

liquidity levels in the financial system from Fed quantitative tightening, leading to increased

funding costs and/or lower levels of asset growth due to funding constraints; 2) a potential

recession, driving credit deterioration and an industry-wide downshift in loan demand; 3) the

potential for rate cuts by the Fed in response to recessionary pressures, leading to net interest

margin pressure/reduced NII levels going forward; and 4) a more rigorous regulatory

environment that could lead to, heightened oversight, greater capital requirements, and in

turn lower capital returns to shareholders.

First Read: Citigroup Inc 14 July 2026 ab 2