Q4 Preview: Citigroup (C) CEO Pandit 'All Smiles' Heading into Earnings
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Price: $61.79 -1.09%
Revenue Growth %: -1.4%
Financial Fact:
Net interest revenue: 11.48B
Today's EPS Names:
FRSB, DGICA, UXIN, More
Revenue Growth %: -1.4%
Financial Fact:
Net interest revenue: 11.48B
Today's EPS Names:
FRSB, DGICA, UXIN, More
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Citigroup, Inc. (NYSE: C) shares are trading higher ahead of the company's fourth quarter 2010 earnings release, expected out before the market opens on Tuesday, January 18, which will be the next trading day due to the MLK holiday on Monday. Shares are up 1.9% this afternoon.
Citi is expected to report EPS of $0.08 on revs of $20.50 billion. Last quarter, the New York, NY-based financial institution reported EPS of $0.08 with revs of $20.74 billion, mixed to the consensus estimates. For Q409, Citi procured a loss per share of $0.06, ex-items, with revs of $11.7 billion.
Shares gained 15.6% through the quarter, to $4.73 at the end of December. The stock is up about 7% since the end of the quarter, and shares ended up 39% better in 2010.
A simple valuation puts the company with a forward P/E of 11x FY11 EPS estimates, compared to 10.1x for Bank of America (NYSE: BAC), 11.5x for Wells Fargo (NYSE: WFC), and 9.7x for J.P. Morgan (NYSE: JPM).
Data from Bloomberg has 16 analysts with a Buy on C, 9 with a hold, and three suggesting to Sell. The analyst price target average is $5.50, with a high of $6.96 and low of $4.
Summary
A little pressure may be alleviated on the financial sector, which is typically the first major sector to report earnings amid the wave to come, as J.P. Morgan amassed a solid fourth quarter report.
This will be the Citigroup's first quarterly report as a government free company since the bailout, after the Treasury finished up selling their shares in December.
Keefe, Bruyette & Woods thinks that, despite strong revs out of corporate finance, they see continued sluggish trading volumes and widening credit spreads at international counterparties. KBW is looking for an EPS of $0.08. They have a Market Perform on the stock, which they've kept on since Citi was trading for $37. Price target is $5.00.
J.P. Morgan sees pressure in EMEA stemming from "risk aversion in fixed income markets with the sovereign crisis and low rates." Additionally, "Good growth in emerging markets where Citi has broader franchises is likely to be offset partly by slower growth in developed markets. Investment banking is recovering from large-scale departures. Credit quality is improving, leading to reserve releases. Longer term, Citi needs to re-evaluate its strategy for consumer banking in developed markets in Western Europe given its position as a leading global bank. Citi also has to evaluate its stake in Akbank due to Basel 3. EMEA is the third among four regions for Citi in terms of revenues and net income and its share of net income could diminish with stronger growth in Asia and Latin America and further decline in credit costs in North America."
JPM currently is looking for EPS of $0.07. They have an Overweight rating on the stock, with a $6.00 price target.
Bloombnerg notes, with a smiling photo accompaniment, that Vikram Pandit will be able to report the first profit for his company since he took the helm three years ago. In his first tow years as CEO, Pandit saw Citi bleed $29.3 billion.
Shareholders will be looking for some clarity on future earnings power, with current estimates varying widely. Some see earnings power up to $1 per share over the next few years, while others don't see the company earning more than $0.50 per share.
There has also been some speculation recently that a reverse stocks split could be announced with the earnings report.
Citigroup, Inc. is expected to release their Q410 earnings on Tuesday, January 18, 2011, at approximately 8:00am EST. Stay tuned to StreetInsider.com's EPS Central section to see our analysis of the highly-anticipated quarterly results withi0 n seconds of their release.
Citi is expected to report EPS of $0.08 on revs of $20.50 billion. Last quarter, the New York, NY-based financial institution reported EPS of $0.08 with revs of $20.74 billion, mixed to the consensus estimates. For Q409, Citi procured a loss per share of $0.06, ex-items, with revs of $11.7 billion.
Shares gained 15.6% through the quarter, to $4.73 at the end of December. The stock is up about 7% since the end of the quarter, and shares ended up 39% better in 2010.
A simple valuation puts the company with a forward P/E of 11x FY11 EPS estimates, compared to 10.1x for Bank of America (NYSE: BAC), 11.5x for Wells Fargo (NYSE: WFC), and 9.7x for J.P. Morgan (NYSE: JPM).
Data from Bloomberg has 16 analysts with a Buy on C, 9 with a hold, and three suggesting to Sell. The analyst price target average is $5.50, with a high of $6.96 and low of $4.
Summary
A little pressure may be alleviated on the financial sector, which is typically the first major sector to report earnings amid the wave to come, as J.P. Morgan amassed a solid fourth quarter report.
This will be the Citigroup's first quarterly report as a government free company since the bailout, after the Treasury finished up selling their shares in December.
Keefe, Bruyette & Woods thinks that, despite strong revs out of corporate finance, they see continued sluggish trading volumes and widening credit spreads at international counterparties. KBW is looking for an EPS of $0.08. They have a Market Perform on the stock, which they've kept on since Citi was trading for $37. Price target is $5.00.
J.P. Morgan sees pressure in EMEA stemming from "risk aversion in fixed income markets with the sovereign crisis and low rates." Additionally, "Good growth in emerging markets where Citi has broader franchises is likely to be offset partly by slower growth in developed markets. Investment banking is recovering from large-scale departures. Credit quality is improving, leading to reserve releases. Longer term, Citi needs to re-evaluate its strategy for consumer banking in developed markets in Western Europe given its position as a leading global bank. Citi also has to evaluate its stake in Akbank due to Basel 3. EMEA is the third among four regions for Citi in terms of revenues and net income and its share of net income could diminish with stronger growth in Asia and Latin America and further decline in credit costs in North America."
JPM currently is looking for EPS of $0.07. They have an Overweight rating on the stock, with a $6.00 price target.
Bloombnerg notes, with a smiling photo accompaniment, that Vikram Pandit will be able to report the first profit for his company since he took the helm three years ago. In his first tow years as CEO, Pandit saw Citi bleed $29.3 billion.
Shareholders will be looking for some clarity on future earnings power, with current estimates varying widely. Some see earnings power up to $1 per share over the next few years, while others don't see the company earning more than $0.50 per share.
There has also been some speculation recently that a reverse stocks split could be announced with the earnings report.
Citigroup, Inc. is expected to release their Q410 earnings on Tuesday, January 18, 2011, at approximately 8:00am EST. Stay tuned to StreetInsider.com's EPS Central section to see our analysis of the highly-anticipated quarterly results withi0 n seconds of their release.
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