Citigroup Stock (C) Good Growth and Good Value in Q3 2025

In the ever-evolving world of banking, few large-cap players are capturing attention quite like Citigroup (NYSE: C). With its third-quarter 2025 earnings demonstrating both solid top-line growth and improving profitability, the company is signaling a compelling blend of growth and value, a proposition that is rare in the financial sector today. For value-oriented investors looking for exposure to financials with upside potential, Citi offers an interesting case: strong recent performance, favorable analyst sentiment and attractive valuation metrics. In this article we will dive into Citigroup’s recent earnings, stock performance & valuation, growth potential, and the risks investor should consider.

About Citigroup

Citigroup commonly known simply as Citi, is a major American multinational investment bank and financial services corporation, with operations spanning more than 100 countries and territories. Founded in 1998, Citi offers a wide range of products including corporate & investment banking, consumer banking, credit cards, wealth management, treasury & trade services, and markets businesses. Its scale, global reach and diversified business lines position it differently from more narrowly focused banks. Under CEO Jane Fraser, the firm has been pursuing a streamlining of operations and a simplification of its business model into five core segments, Banking, Wealth, Markets, Services and U.S. Personal Banking.

Citigroup Financial Performance

Citigroup delivered strong financial results in its Q3 2025 earnings report, showcasing consistent growth across key metrics. The company reported revenue of $19.83 billion for the quarter, up 10.92% from $17.88 billion in Q3 2024. Quarterly earnings per share (EPS) also improved significantly to $1.86, marking a 23.12% increase from $1.51 in the same period last year. On a trailing twelve-month (TTM) basis, revenue rose 9.16% to $75.38 billion, compared to $69.5 billion a year earlier, while EPS more than doubled, climbing 103.92% from $3.48 to $7.10. Profitability remained solid, with an operating profit margin of 26.55% and a net profit margin of 19.49%, reflecting stronger cost efficiency and disciplined expense management. Citigroup also achieved a Return on Assets of 0.58% and a Return on Equity of 7%, signaling steady improvements in financial performance.

Over the past five years, Citigroup has grown its revenue at 4.6% and net income at 6.1%. Although the growth over the past five years appears slow, the recent double-digit EPS growth is a positive catalyst and an important driver for Citigroup’s stock.

Citigroup Fiscal 2025 Financial Forecast

Looking ahead, analysts forecast 2025 revenue of $86.17 billion, a 6.21% increase from $81.14 billion in 2024, and project Non-GAAP EPS of $7.99, representing 28.51% year-over-year growth from $6.22. The stock carries a Buy rating, with an average price target of $113.12 offering a 13.92% potential upside and a high target of $134, which implies a 34.94% upside potential, underscoring growing investor confidence in Citigroup’s continued momentum.

C Stock Price Performance and Valuation

At the time this article was written Citigroup (C) trades at $99.30 per share. Citigroup’s stock has shown remarkable performance over the past year, significantly outperforming the broader market. marking an impressive 60.6% increase over the past twelve months, far ahead of the S&P 500’s 15% gain during the same period. Over the longer term, the stock has also demonstrated solid returns, rising 125.9% over the past five years, compared to the S&P 500’s 94.1% increase. 

Despite this strong price appreciation, Citigroup’s valuation remains attractive, supported by a dividend yield of 2.42%, a price-to-sales (P/S) ratio of 2.4 on a trailing twelve-month basis, and a forward P/S ratio of 2.02. The company also maintains a reasonable Non-GAAP price-to-earnings (P/E) ratio of 13.66, with a forward P/E of 12.87. 

Based on Fiscal.ai data, if we look at the valuation over the past five years, the forward P/S and forward P/E are above the average. Although the valuation is higher than the historical average, Citigroup’s improving financial performance with EPS expected to grow by more than 20% makes the valuation still reasonable.

Citigroup Growth Potential

Citigroup growth prospect remains robust, driven by several factors.

• Strategic Business Transformation and Operational Excellence
  Citigroup's recent Q3 2025 earnings reflect a company showing strong momentum and operational modernization. The bank posted record revenues of $22.09 billion, with all divisions, markets, banking, services, wealth, and retail delivering their best quarterly performances. Net profit soared 16% to $3.8 billion, driven by a surge in dealmaking, trading, and record high revenue across segments.
  Key to this growth has been its ongoing transformation under CEO Jane Fraser, with significant progress in simplifying operations, retiring or replacing 384 applications in 2025, and leveraging AI to boost productivity. These efforts have created approximately 100,000 hours of weekly developer capacity and accessed AI tools 7 million times this year. Citigroup is positioned to reach its targeted ROTCE of 10-11% by 2026, with Q3 ROTCE at 9.7%.
• Robust Revenue Growth Across Core Business Segments
  Citigroup's Q3 2025 displayed exceptional revenue growth, with total revenues reaching $22.1 billion, up 9% year-over-year and surpassing analyst expectations of $21.11 billion. All five business segments posted record quarterly performances. Banking revenues surged 34% to $2.1 billion, driven by increased investment banking activity and strong deal-making momentum. Markets revenues rose 15% to $5.6 billion, bolstered by a 44% increase in prime balances and solid performance in Fixed Income and Equity markets.
  The Services segment achieved its best quarter ever with 7% revenue growth, with Treasury and Trade Solutions gaining around 85 basis points of market share. Wealth division reported record net new investment assets of $18.6 billion along with 8% revenue growth. Additionally, net interest income grew 12%, fueled by higher interest rates and volume gains across multiple segments, underscoring Citigroup’s robust, diversified business model and competitive market positioning.
• Advanced Technology Integration and Digital Innovation Leadership
  Citigroup’s robust investment in artificial intelligence (AI) and digital transformation is a key driver of its competitive advantage and growth. In September 2025, the bank launched an AI agent pilot involving 5,000 employees capable of completing multi-step tasks from a single prompt, with CEO Jane Fraser calling early results very promising. Its proprietary AI platform, Citi Stylus Workspaces, integrates agentic AI with systems using Google Cloud, Vertex AI, and Anthropic’s Claude models.
  The bank invested $2.4 billion in technology in Q1 2025, supporting AI deployment and regulatory compliance. AI tools have been accessed over 7 million times by employees this year, enhancing productivity and risk management. Citigroup plans to expand these initiatives in 2026, including launching digital asset custody services, positioning the bank strongly in the evolving digital financial landscape and pursuing $2–2.5 billion in annual cost savings by 2026 through AI-driven efficiency.

Risks to Consider

While Citigroup growth is strong, we should be mindful of potential risks.

• Credit Risk
  Risks from borrower defaults arise when clients fail to meet their financial obligations, especially in worsening economic conditions that reduce repayment capacity. Collateral devaluation intensifies these losses if the assets securing loans lose value, undermining recovery prospects. Additionally, Citigroup faces concentrated exposures in specific sectors or geographies, which can magnify loss potential if adverse events disproportionately affect those areas. Managing these credit risks is crucial for maintaining financial resilience and minimizing impacts on Citi’s loan portfolio.
• Liquidity and Capital Risk
  Citigroup faces challenges in maintaining adequate liquidity buffers, essential to meet short-term financial obligations. Sudden deposit outflows can strain liquidity, reducing available cash for daily operations. Additionally, regulatory capital requirements mandate Citigroup to hold sufficient high-quality liquid assets and capital ratios to absorb losses and withstand financial stress. These factors can limit the bank’s ability to monetize liquidity resources effectively, impacting its resilience during economic or market shocks.
• Regulatory, Legal, and Governance Risks
  Citigroup faces significant risks from regulatory changes, compliance failures, litigation, and governance challenges that impact its operational and financial stability. The bank has struggled with gaps in compliance risk management, insufficient staff training, and skill shortages, which prolong the resolution of regulatory issues. Past compliance failures have led to fines and sanctions, underscoring the critical need for improved governance and adherence to evolving regulations to protect Citi’s business integrity.

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Conclusion

Citigroup’s strong Q3 2025 performance highlights its solid growth, improving profitability, and attractive valuation. The company continues to strengthen its balance sheet while delivering rising revenue and earnings, supported by strategic transformation and disciplined cost management. With analysts projecting further growth and a potential upside of over 13%, Citi offers both value and momentum. Despite typical banking sector risks, its robust fundamentals and long-term prospects make Citigroup a compelling buy for investors seeking sustainable growth and income.