It's taken far longer than shareholders wanted, but Citigroup (C) shares have finally started outperforming. I believe this recent improvement has more to do with the overall rally in bank stocks than any particular surge in confidence regarding Citi's turnaround plan, but I do believe that a healthier economic environment in 2021 will help that process. I'm likewise bullish on the prospects for new CEO Jane Fraser to effect real changes in the business given her history with operational turnarounds.
I've been bullish on Citi for a while, but the bank has only matched its peer group over the last three years as management has struggled to make meaningful changes to the business. I do believe Fraser will improve and accelerate that process, and I expect that investors will see incremental changes (announcements) in strategy as opposed to a big one-time announcement, and those announcements could help build some momentum through 2021. I do believe there is a lot of work ahead for Citi to close the ROTCE gap with its peers, and I'm not expecting Citi to become the best of the group, but I do still see more upside here as these changes start to take hold.
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Progress On Self-Improvement Efforts Can Make Citi A Winner In 2021
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