The combination of a sector-wide “risk on” shift and more appreciation of Citizens Financial’s (CFG) improvements to date have certainly helped the shares. The stock has risen more than a third since my last write-up, beating its peer group by about 10 points over that time, and the average sell-side price target has risen about 50% in just a little over three months.
Even with the greater appreciation of what Citizens has achieved on the self-help front, and perhaps more acknowledgement of what it still can do, I believe the shares remain undervalued going into 2021. Management’s targets for 2021 are aggressive in some respects (setting the stage for potential disappointment), but I believe there is still more improvement to come in a few years on both expenses and revenue growth. With annualized total return potential that is still in the double-digits, I continue to believe that Citizens is worth owning.
Read more here:
Citizens Financial Getting More Credit, But Still Has Underappreciated Self-Help Potential
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