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Citigroup (C) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
Independent Bank Corp. (INDB) delivered earnings and revenue surprises of -0.77% and 0.76%, respectively, for the quarter ended December 2018. Do the numbers hold clues to what lies ahead for the stock?

Citigroup (C) closed the most recent trading day at $55.46, moving -0.27% from the previous trading session. This change lagged the S&P 500's daily gain of 0.97%. Elsewhere, the Dow gained 1.09%, while the tech-heavy Nasdaq added 1.08%.

Heading into today, shares of the U.S. bank had lost 2.56% over the past month, lagging the Finance sector's loss of 1.97% and outpacing the S&P 500's loss of 3.04% in that time.

C will be looking to display strength as it nears its next earnings release, which is expected to be January 14, 2019. The company is expected to report EPS of $1.58, up 23.44% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.65 billion, up 2.31% from the year-ago period.

Investors should also note any recent changes to analyst estimates for C. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 1.42% lower within the past month. C currently has a Zacks Rank of #3 (Hold).

In terms of valuation, C is currently trading at a Forward P/E ratio of 7.43. This valuation marks a discount compared to its industry's average Forward P/E of 9.71.

Meanwhile, C's PEG ratio is currently 0.65. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Banks - Major Regional industry currently had an average PEG ratio of 1.02 as of yesterday's close.

The Banks - Major Regional industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 101, which puts it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow C in the coming trading sessions, be sure to utilize Zacks.com.


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