Citigroup Inc. (NYSE:C) Surpasses Earnings Estimates but Faces Revenue Shortfall

• Citigroup Inc. (NYSE:C) reported earnings per share (EPS) of $1.34, exceeding the estimated $1.21 and the Zacks Consensus Estimate of $1.25.
• Despite surpassing EPS estimates, Citigroup's revenue of $17.44 billion fell short of the expected $19.51 billion.
• The company announced a $20 billion share buyback program, boosting investor confidence despite some financial challenges.

Citigroup Inc. (NYSE:C) is a leading global bank with a wide range of financial services, including consumer banking, corporate and investment banking, and wealth management. As a major player in the financial industry, Citigroup competes with other banking giants like JPMorgan Chase and Bank of America. The company is known for its extensive international presence and diverse financial offerings.

On January 15, 2025, Citigroup reported earnings per share (EPS) of $1.34, surpassing the estimated $1.21. This performance also exceeded the Zacks Consensus Estimate of $1.25 per share, marking a significant improvement from the $0.84 per share reported in the same quarter last year. The bank's strong earnings performance led to a 5.5% surge in its share price during pre-market trading, as highlighted by Zacks.

Despite the positive EPS, Citigroup's revenue of $17.44 billion fell short of the estimated $19.51 billion. However, the bank's net income for the fourth quarter reached $2.86 billion, a significant turnaround from a loss of $1.84 billion in the same period the previous year. This improvement was driven by a 12% year-over-year increase in revenue, net of interest expense, to $19.58 billion, surpassing forecasts.

Citigroup's financial health is further supported by a reduction in the cost of credit by 27% to $2.59 billion, contributing to the boost in net income. CEO Jane Fraser emphasized that the company's strategy is delivering as intended, driving stronger performance in its businesses. Additionally, Citigroup announced a substantial $20 billion share buyback program, which is set to commence this quarter, further boosting investor confidence.

Despite these positive developments, Citigroup faces some financial challenges. The company's enterprise value to operating cash flow ratio is negative at -27.10, indicating potential difficulties in generating cash flow relative to its enterprise value. Additionally, the current ratio is notably low at 0.05, suggesting potential liquidity concerns in meeting short-term obligations. However, the company's earnings yield of approximately 5.15% provides insight into the return on investment for shareholders.