Barclays moved off the sidelines on Citigroup, citing an “inflection point” for the company as the outlook improves for large-cap banks across the board. Analyst Jason Goldberg upgraded Citigroup to overweight from equal weight, putting him in the majority on Wall Street with a buy-equivalent rating, per LSEG. Goldberg also hiked his price target by $25 to $95, which now implies 33.8% upside over Friday’s close. “Our thesis for Large-Cap Bank stocks in 2025/26 centers around accelerating earnings growth, higher investment banking fees, healthy operating leverage, increasing [return on tangible common equity], greater capital return, and [price-to-earnings] multiple expansion,” Goldberg wrote to clients. “We expect C to amplify these drivers.” Goldberg said Citi may be at a turning point, given that it saw annual revenue growth and positive operating leverage for all five of its businesses during the third quarter. What’s more, Goldberg said to expect more improvements on revenue and expense targets — even after they were met in 2024. As Citi’s return on tangible common equity improves toward 11% to 12% from the current 7.2% level, he said investors can anticipate its valuation also getting stronger. This comes as Goldberg said he’s “constructive” overall on large-cap U.S. bank stocks, with animal spirits coming to life after the success of Republicans in November’s election. Banks have gotten a boost since the election, as investors expect deregulation to facilitate dealmaking. To be sure, Goldberg said regulatory risks are still a potential overhang on the stock. Given that its the most internationally exposed bank covered by Barclays, he noted there’s specific concerns tied to emerging markets. Shares advanced 1.8% in Monday’s premarket trading. The stock has added about 0.9% so far in 2025, building on last year’s climb of more than 36%. C 1Y mountain Citigroup, 1-year
