Citizens Financial Group, Inc. CFG
Verdict: Hold. Fair value $66.08 against a price of $61.05 on 6 Jan 2026, 8% above the price.
In plain words
The case for: Narrow competitive moat provides durability.
The case against: Intense competitive pressure could compress margins. The OCF / Net Income ratio has steadily declined from a very strong 1.99 in 2022 to 1.84 in 2023,.... Net Income has fallen significantly from $2.32B in 2021 to $1.51B in 2024, a 35% decrease. Over the....
Main risks
- Steeply declining profitability: Net income has fallen consistently from $2.32B in 2021 to $1.51B in 2024, and net margins have compressed from ~35% to ~19%.
- Negative recent revenue growth: The latest annual revenue declined 5.2% year-over-year, indicating a business slowdown despite a positive 3-year CAGR.
- Weak return on capital: ROE (6.2%) and ROA (0.7%) are below industry averages, and a calculated ROIIC of 8.6% suggests poor returns on new investments.
- The OCF / Net Income ratio has steadily declined from a very strong 1.99 in 2022 to 1.84 in 2023,...
- Net Income has fallen significantly from $2.32B in 2021 to $1.51B in 2024, a 35% decrease. Over the...
- Intense competitive environment