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Citigroup Inc C

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

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Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Better Revenue Outlook, Reserve Releases Help Citigroup in First Quarter

Eric Compton, CFA Senior Equity Analyst

Analyst Note

| Eric Compton, CFA |

Narrow-moat Citigroup reported decent first-quarter earnings, easily beating FactSet consensus EPS of $2.60 with reported EPS of $3.62. This equates to a return on tangible common equity of 20% for the quarter. The biggest swing factor was provisioning for credit losses. As we had expected, the bank released a sizable portion of reserves, totaling roughly $4 billion. We have been more bullish than consensus on reserve releases, and with the current set of releases, the bank is nearing our full-year estimate already.  We were expecting additional releases in 2022, but some of these may be pushed into 2021 if the environment continues to trend in a positive direction.

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Company Profile

Business Description

Citigroup is a global financial services company doing business in more than 100 countries and jurisdictions. Citigroup's operations are organized into two primary segments: the global consumer banking segment, which provides basic branch banking around the world, and the institutional clients group, which provides large customers around the globe with investment banking, cash management, and other products and services.

Contact
388 Greenwich Street
New York, NY, 10013
T +1 212 559-1000
Sector Financial Services
Industry Banks - Diversified
Most Recent Earnings Dec 31, 2020
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 210,000

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