Investing.com – Barclays Bank upgrades rating Citigroup Inc (NYSE:) will be “overweight” given that the company is at a key inflection point heading into 2025, which is not fully reflected in Citigroup’s discounted valuation compared to peers.
“We are attracted to Company C because its recent actions allow it to generate more stable and high-quality earnings while also optimizing its capital base,” the analyst said. The bank has reduced its international presence and prioritized efficiency.
Barclays (LON:) has set a price target of $95 with an upside of $102 if economic conditions improve. This upside potential is driven by a favorable backdrop of lower interest rates, low net write-offs and controlled expenses. The brokerage expects Citigroup’s earnings to reach $10 per share by 2026 in this scenario.
However, the downside is $60, which comes with potential hurdles. These include worsening consumer economic conditions in the U.S., particularly in the credit card industry, as well as higher-than-expected costs associated with the consent order, which could lower 2026 earnings per share to $7.50.
Barclays also noted risks associated with Citigroup’s significant international presence, particularly in emerging markets with economic and political uncertainty.