UPDATE: Credit Suisse Downgrades Citi (C) to Neutral

Credit Suisse analyst Susan Roth Katzke downgraded Citi (NYSE: C) from to Neutral with a price target of $58.00.

The analyst comments "With Citi shares up ~15% off their recent lows and within 10% of our $58 target price we are downgrading to Neutral from Outperform. Risk vs reward… we realize that the downside to C shares may prove more limited given a valuation within reach of prior cyclical troughs; but we believe the upside, relative to peers, will also prove more limited given the long road ahead in Citi’s transformation process. Sustainable share price outperformance relies on tangible evidence of both improving ROTE prospects and competitive ROTE potential. Our estimates are unchanged; earnings visibility remains more limited than we’d like compromised by (i) the need for higher levels of investment to support infrastructure transformation and organic growth, (ii) limited near term capital return capacity, and (iii) the pace of market exits (including CTAs and the reduction in stranded costs); longer term opportunity ties to potential incremental free capital generation as market exits are completed. Risk (+/-) to the achievability of our estimates and target price ties to the macro and market backdrop, the cost/benefit of strategic initiatives (transformation, market exits), and competitive positioning in the core of the Citi franchise."

For an analyst ratings summary and ratings history on Citi click here. For more ratings news on Citi click here.

Shares of Citi closed at $54.09 yesterday.

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