Citigroup (C) Exceeds Market Returns: Some Facts to Consider

Citigroup (C) closed the most recent trading day at $133.25, moving +1.16% from the previous trading session. The stock exceeded the S&P 500, which registered a gain of 0.32% for the day. Elsewhere, the Dow saw an upswing of 0.3%, while the tech-heavy Nasdaq appreciated by 0.66%.

Prior to today's trading, shares of the U.S. bank had lost 1.04% lagged the Finance sector's gain of 1.81% and the S&P 500's gain of 3.34%.

The investment community will be closely monitoring the performance of Citigroup in its forthcoming earnings report. The company is expected to report EPS of $2.68, up 19.64% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $23.74 billion, indicating a 7.46% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $11.2 per share and revenue of $95.56 billion, which would represent changes of +40.53% and +12.13%, respectively, from the prior year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Citigroup. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.05% higher within the past month. At present, Citigroup boasts a Zacks Rank of #2 (Buy).

Looking at valuation, Citigroup is presently trading at a Forward P/E ratio of 11.76. For comparison, its industry has an average Forward P/E of 14.65, which means Citigroup is trading at a discount to the group.

We can also see that C currently has a PEG ratio of 0.59. 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 Financial - Investment Bank industry currently had an average PEG ratio of 1.02 as of yesterday's close.

The Financial - Investment Bank industry is part of the Finance sector. This group has a Zacks Industry Rank of 34, putting it in the top 14% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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