- Cit's second quarter earnings report was pretty typical, with a modest pre-provision profit beat boosted by lower provisioning and a lower tax rate, as well as soft loan growth.
- Credit quality continues to improve, and card spending has already rebounded; commercial loan growth should pick up more noticeably in 2022.
- Management is focusing on driving better growth from more profitable businesses, including global payments, and that should help drive ROTCE above 10% in 2023.
- Citi's past failures to meet, let alone exceed, targets do still impact sentiment, but I believe the shares are significantly undervalued on relatively undemanding core earnings growth assumptions.
For further details see:
Citigroup Still Offers Significant Execution-Driven Upside