Citigroup EPS Estimates Cut Significantly

NEW YORK (TheStreet) -- Citigroup (C) has had its share of bad news lately, and analysts are making major cuts to their 2014 earnings forecasts for the bank, following a presentation by the company's CFO John Gerspach on Monday.

Gerspach at the Raymond James Institutional Investors conference on Monday said, "in total we currently see our markets revenues being down by a high mid-teens percentage year over year." The CFO also said first-quarter investment banking revenue was "tracking lower" and that expenses would be "modestly higher than the fourth quarter."

Atlantic Equities analyst Richard Staite on Wednesday cut his 2014 earnings estimate for Citigroup by 19% to $1.14 from $1.40, and cut his 2014 EPS estimate to $4.59 from $4.96. In a note to clients, Staite also expressed doubt in Citigroup's ability to hit its 2015 target of a 15% return on tangible common equity (ROTCE).

Staite stuck with his "neutral" rating for Citigroup, with a price target of $55, representing 13% upside potential from Citi's closing price on Tuesday of $48.83. He also left his 2015 EPS estimate unchanged, at $5.38.

Credit Suisse analyst Moshe Orenbuch on Tuesday cut his first-quarter EPS estimate for Citi by 15% to $1.21 from $1.41, and cut his 2014 EPS estimate to $5.00 from $5.25, while leaving his 2015 EPS estimate unchanged at $5.85.

Orenbuch rates Citi "outperform," with a $65 price target.

JPMorgan Chase (JPM) last week during its Investor Day presentations was the first major U.S. bank to signal a slow first-quarter for trading, saying said it expected its trading revenue to decline by 15%. But analyst reaction was on the whole positive, because the bank seems well-positioned to reach its "normalized" goal of a 15-16% ROTCE.

If you liked this article you might like

Bank Stocks Move Higher Ahead of Federal Reserve Meeting

All Eyes on the Godfather of Central Banking as Fed Has Huge Meeting This Week

The Stock Market Stinks and the Stench Is Going to Get Much Worse Soon

Financials Trade Close to Flat as Investors Await Clarity From the Fed

Don't Get Shaken Out of Good Stocks: Cramer's 'Mad Money' Recap (Wed 9/13/17)