It’s still early days for Jane Fraser’s tenure as the CEO of Citigroup (NYSE:C), but she’s off to a good start with the Street generally liking the news of the company’s plan to exit its non-core global consumer banking businesses. It remains to be seen what the company will do with respect to building up the U.S. operations, including potential M&A, but focusing on businesses with higher prospective returns is definitely the right move.
Citigroup shares have slightly outperformed the larger banking group since my last update, and I continue to think there’s a good argument for owning these shares as a play on a leaner, more profitable bank with strong global corporate finance capabilities and an improving core consumer bank. Low single-digit long-term core growth can still support a double-digit annualized return from here, and I believe this is an interesting risk/reward opportunity for investors willing and able to take more risk.
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Citigroup Still Has A Lot Of Work And Potential Gains, Ahead Of It
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