Despite a lower 52-week high of
$64.98 compared to JPMorgan, Citigroup's stability is reflected in its lower debt-to-equity ratio of
0.91%, suggesting less volatility. Additionally, with a robust net asset value of
$2.42 trillion and a five-year return of
3.01%, Citigroup presents a potentially less unpredictable investment opportunity in the US stock market.
Main Ideas
By comparing fundamental indicators of Citigroup and JPMorgan, we can examine the impact of market volatility on both companies' prices and assess if they can mitigate market risk when combined in a portfolio. Pair trading strategies can also be employed, such as matching a long position in JPMorgan with a short position in Citigroup. For more details, refer to our pair correlation module.
Now, let's discuss asset utilization, which typically refers to the revenue generated per dollar of a company's reported assets. Citigroup's recent return on assets suggests inefficient asset utilization in June.
Investment perspective, in general, refers to a viewpoint or opinion regarding investment opportunity in Citigroup. It encompasses the assessment of an investment's potential risks and rewards, and expectations for its
performance over time. Several factors influence the investment perspective on Citigroup, including investment goals, risk tolerance, time horizon, market conditions, and research and analysis. Investors have varying goals, such as capital preservation, income generation, or long-term growth. Risk tolerance plays a significant role in shaping an investor's perspective, with some being more risk-averse and others willing to take on higher risks for potential returns.
How important is Citigroup's Liquidity
Citigroup
financial leverage refers to using borrowed capital as a funding source to finance Citigroup ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Citigroup financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Citigroup's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Citigroup's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the
breakdown between Citigroup's total debt and its cash.
Citigroup Gross Profit
Citigroup Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Citigroup previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Citigroup Gross Profit growth over the last 10 years. Please check Citigroup's
gross profit and other
fundamental indicators for more details.
Is Citigroup valued correctly by the market?
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.
Revenue Breakdown
Lets now take a look at Citigroup revenue. Based on the latest financial disclosure, Citigroup reported 78.49
B of revenue.
This is much higher than that of the Banks sector and significantly higher than that of the
Financials industry. The revenue for all United States stocks is significantly lower than that of Citigroup. As for JPMorgan Chase we see revenue of 154.95
B, which is much higher than that of the Financials
| Citigroup | 78.49 Billion |
| Sector | 0.0 |
| JPMorgan | 154.95 Billion |
The market moves in mysterious ways, yet Citigroup's performance can be tracked and analyzed with relative ease. Despite a higher beta of 1.47 indicating greater volatility, Citigroup's downside deviation and variance are lower at 1.42 and 1.92 respectively compared to JPMorgan's, suggesting less unpredictability. With a strong operating income of 9.4 billion and an impressive book value of 99.08, Citigroup seems to be standing on solid ground. The firm's risk-adjusted performance stands at 0.0299, further emphasizing its stability. While the probability of bankruptcy is marked at 48.13%, the overall financial health and performance indicate a lower risk than the figure suggests..
Will Citigroup dip impact its fundamentals?
Citigroup's mean deviation, recently rising over 1.11, suggests increased price volatility, which may potentially trigger a decrease in stock value. However, short-term market fluctuations don't necessarily affect a company's core health. Investors should examine Citigroup's key financials like earnings, revenue growth, and balance sheet strength to determine if a potential dip would significantly impact its fundamentals. Despite this, Citigroup's volatility is relatively low, with a skewness of -0.13 and kurtosis of -0.15. Understanding market volatility trends can help investors time the market. Utilizing volatility indicators properly allows traders to gauge Citigroup's stock risk against market volatility in both bullish and bearish trends.
The heightened volatility in bear markets can directly affect Citigroup's stock price, causing stress for investors as they witness their shares' value decline, often leading them to diversify their portfolios by purchasing different financial instruments.In conclusion, despite the recent dip in Citigroup's market value, the financial analysis suggests that this may be a potential buying opportunity for investors. The company's real value is calculated at
$54.9, which is relatively close to the current market valuation of
$59.99. With the possible upside price at $62.47 and the naive expected forecast value at $61.11, there's a potential for profit. The overall consensus from analysts is a 'Buy' with 6 buys, 8 strong buys and 9 holds. Therefore, investors could consider taking advantage of this dip, keeping in mind the possible downside price of $59.76. However, as always, investors are advised to do their own due diligence and consider their risk tolerance before making investment decisions..
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Ellen Johnson is a Member of Macroaxis Editorial Board. Ellen covers public companies in North America, focusing primarily on valuation and volatility. Six years of experience in predictive investment analytics and risk management.
View Profile This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Ellen Johnson do not own shares of Citigroup. Please refer to our
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