Citigroup Stock Reaches New 52-Week High: Hold or Fold Now?

Shares of Citigroup, Inc. C touched a new 52-week high of $124.06 during yesterday’s trading session, closing slightly lower at $123.30. The rally was driven by expectations that the capture of Venezuela’s president Nicolas Maduro by the United States, aimed at securing access to its vast oil reserves, could spur increased investment across the oil and gas sector. This dynamic is viewed as a positive for major banks like Citigroup, which stand to benefit from higher demand for corporate lending, project finance, trading, and advisory services tied to energy investment and cross-border activity. Over the past year, the C stock has surged 72%, significantly outperforming the industry’s growth of 43.1% and its peers Bank of America BAC and Wells Fargo’s WFC rallies 26.2% and 37.5%, respectively. This strong performance underscores growing investor confidence in Citigroup’s balance sheet strength and strategic execution.Price Performance Image Source: Zacks Investment Research However, with the C stock now trading higher, investors are now assessing whether the stock still has upside potential or if it's time to cash out profits. Let us find out.From Complexity to Focus: C’s Strategic ResetCEO Jane Fraser continues to advance the company’s multi-year strategy to streamline operations and focus on its core businesses. Since announcing plans in April 2021 to exit consumer banking in 14 markets across Asia and EMEA, the company has completed its exit in nine countries.This month, Citigroup sold its Russia-based banking unit, AO Citibank, to Renaissance Capital. While the transaction is expected to result in a pre-tax loss of nearly $1.2 billion in the fourth quarter of 2025, it should improve the bank’s capital position over time by eliminating related risk-weighted assets. Last month, C divested a 25% stake in Banamex to a Mexican business leader after separating its Mexican institutional banking business from consumer and middle-market units in December 2024. The company is now preparing for a planned initial public offering (IPO) of its Mexican consumer and small and middle-market banking units. In May 2025, C announced an agreement to sell its consumer banking business in Poland, while in June 2024, it sold its China-based consumer wealth portfolio. Also, as part of its strategy, Citigroup continues to make progress with the wind-down of its Korea consumer banking operations. These initiatives will free up capital and help the company pursue investments in wealth management and investment banking (IB) operations, which will stoke fee income growth. In sync with its plan to accelerate its IB business growth, Citigroup plans to increase its Japan IB headcount by 30% by the first half of 2026 to seize opportunities from a surge in merger and acquisition (M&A) deals, according to a Seeking Alpha article, published on MSN. The company also announced an organizational realignment to simplify its governance structure by eliminating various management layers. Pursuant to this, the company changed its operating model and the leadership structure. This resulted in a streamlined and straightforward management structure aligned with and supporting the bank's strategy of increased spans of control and significantly reduced bureaucracy and unnecessary complexity.In January 2024, the bank announced plans to cut 20,000 jobs, approximately 8% of its global staff, by 2026. The bank has already made significant progress by reducing its headcount by more than 10,000 employees.Supported by these initiatives, Citigroup projects revenues to see a 4-5% compounded annual growth rate (CAGR) through 2026.Citigroup’s Push for EfficiencyThe company continues to focus on streamlining processes and platforms, and driving automation to reduce manual touchpoints. Citigroup is increasingly deploying artificial intelligence (AI) tools to support these efforts. In support of this strategy, the company signed a multi-year agreement this week with LSEG to modernize its enterprise-wide data infrastructure. The initiative spans markets, investment banking, wealth management, trading and risk functions, aiming to improve data quality, standardization and accessibility across the organization.Management expects these upgrades to enable more data-driven decisions while delivering operational efficiencies at scale. CEO Jane Fraser said that Citigroup’s internal AI tools are freeing up about 100,000 developer hours per week, and close to 180,000 employees across 83 countries have access to the bank’s internal AI capabilities. Citigroup has also referenced an annual technology budget of $12 billion, suggesting the bank has both the funding and organizational push to embed AI across functions.Given such efforts, the company expects to achieve $2-2.5 billion in annualized run rate savings by 2026.Macroenvironment & Regulatory Winds Turn Favorable for CCitigroup stands to benefit from an increasingly supportive macro and regulatory backdrop. Following the initial easing in 2024 and three subsequent rate cuts in 2025, interest rates stand at 3.50-3.75% currently. With lower rates, funding costs gradually stabilize, supporting increased borrowing, which means more loan volumes.Hence, C is expected to witness decent net interest income (NII) growth in the quarters ahead, supported by lower funding costs, increased loan volumes and repricing of maturing assets into higher yields. Management projects 2025 NII to rise 5.5% year over year.Reduced rates are likely to accelerate deal-making momentum by lowering financing costs and prompting companies to revive delayed M&A and capital-raising plans. Cheaper capital, along with resilient economic growth, typically boosts deal pipelines and IPO readiness. This improved backdrop positions Citigroup for stronger IB revenues in the upcoming period. Citigroup expects IB fees to increase year over year in the mid-20s (percentage) in the fourth quarter. At the same time, regulatory pressures are easing. C has received notable regulatory relief after the Office of the Comptroller of the Currency (OCC) removed the July 2024 amendment to the bank’s 2020 consent order. This original consent order was focused on longstanding deficiencies in risk management, data governance, internal controls, and compliance. The regulatory easing aligns with Citigroup’s broader strategy to modernize its technology and control data. The firm has outlined plans to reduce reliance on external IT contractors while expanding internal technology headcount, strengthening in-house governance and execution capabilities. With this burden lifted, C is better-positioned to execute its growth and efficiency initiatives.Citigroup's Solid Liquidity Aid Capital DistributionC enjoys a strong liquidity position. As of Sept. 30, 2025, cash and due from banks, and total investments aggregated to $474.3 billion, while its total debt (short-term and long-term borrowing) was $370.6 billion.Post-clearing the 2025 Fed stress test, the company hiked its dividend 7.1% to 60 cents per share. In the past five years, it has raised its dividends three times. It has a payout ratio of 32%. It has a dividend yield of 1.9%. Wells Fargo has raised its dividend six times in the past five years, while Bank of America has increased its dividend five times in the past five years.In January 2025, Citigroup's board of directors approved a $20-billion common stock repurchase program with no expiration date. As of Sept. 30, 2025, $11.3 billion worth of authorization remained available. Supported by a strong capital and liquidity position, its capital distribution activities seem sustainable.C’s Consensus Signals Accelerating Growth MomentumThe Zacks Consensus Estimate for Citigroup’s 2025 and 2026 earnings implies year-over-year rallies of 26.6% and 33.4%, respectively. The consensus estimate for C’s 2025 and 2026 sales implies year-over-year rallies of 6.4% and 3.2%, respectively.Earnings Estimates Image Source: Zacks Investment Research Sales Estimates Image Source: Zacks Investment Research From a valuation standpoint, C appears inexpensive relative to the industry. It is currently trading at a discount with a forward 12-month price-to-earnings (P/E) of 12.24X, well below the industry average of 15.66X. Further, Bank of America is trading at a 12-month forward P/E of 13.10X, while Wells Fargo is trading at 13.72X.Price-to-Earnings F12M Image Source: Zacks Investment Research Final Thoughts on Citigroup’s StockCitigroup's strong rally reflects not only cyclical tailwinds for financials but also tangible progress in simplifying its business model, strengthening governance, and improving efficiency.Looking forward, the bank appears increasingly well-positioned to translate restructuring gains into sustainable earnings growth. Continued execution on cost reductions, disciplined capital reallocation toward higher-return businesses, and a more supportive macro and regulatory environment provide a constructive foundation. However, with expectations now higher, the stock’s ability to extend its rally will depend on consistent delivery, credit discipline, and the durability of capital markets activities.As such, investors can consider retaining the C stock for now to generate a healthy long-term return. Citigroup currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Just Released: Zacks Top 10 Stocks for 2026Hurry – you can still get in early on our 10 top tickers for 2026. 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