Citizens Financial (CFG) AI Stock Analysis

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Citizens Financial

(NYSE:CFG)

64Neutral

Citizens Financial's overall score is driven by stable financial performance with areas needing improvement, such as operational efficiency and cash flow consistency. Positive factors include reasonable valuation and strong strategic moves highlighted in the earnings call. However, technical indicators suggest a bearish trend, partly offset by attractive valuation and dividend yield.

Positive Factors

Fee Income Growth

Management reaffirmed prior guidance for fee income to grow in the 8-10% y/y range.

Interest Deposit Costs

Interest bearing deposit costs decreased, surprising positively for the quarter.

Net Interest Margin

The company increased the high end of their medium term net interest margin guidance, benefiting from fewer rate cuts and a favorable yield environment.

Negative Factors

Capital Markets Outlook

EPS risk skews to the downside from weaker capital markets and rapid Fed rate-cuts.

Loan Growth Outlook

The stock is rated Hold due to an uncertain core loan growth outlook and macro-driven softer capital markets outlook.

Macro Uncertainty

Macro uncertainty may continue to suppress customer activity.

Citizens Financial (CFG) vs. S&P 500 (SPY)

Market Cap

$15.56B

Dividend Yield4.87%

Average Volume (3M)5.95M

Price to Earnings (P/E)11.8

Beta (1Y)1.41

Revenue Growth-2.52%

EPS Growth13.92%

CountryUS

Employees17,315

SectorFinancial

Sector Strength76

IndustryBanks - Regional

Share Statistics

EPS (TTM)N/A

Shares Outstanding437,133,880

10 Day Avg. Volume6,801,826

30 Day Avg. Volume5,946,103

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)2.47

Price to Cash Flow (P/CF)9.30

P/FCF Ratio3.60

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$46.40

Price Target Upside29.54% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering15

Citizens Financial Business Overview & Revenue Model

Company DescriptionCitizens Financial Group, Inc. operates as the bank holding company for Citizens Bank, National Association that provides retail and commercial banking products and services to individuals, small businesses, middle-market companies, corporations, and institutions in the United States. The company operates in two segments, Consumer Banking and Commercial Banking. The Consumer Banking segment offers deposit products, mortgage and home equity lending products, credit cards, business loans, wealth management, and investment services; and auto, education, and point-of-sale finance loans, as well as digital deposit products. This segment serves its customers through telephone service centers, as well as through its online and mobile platforms. The Commercial Banking segment provides various financial products and solutions, including lending and leasing, deposit and treasury management services, foreign exchange, and interest rate and commodity risk management solutions, as well as syndicated loans, corporate finance, mergers and acquisitions, and debt and equity capital markets services. This segment serves government banking, not-for-profit, healthcare, technology, professionals, oil and gas, asset finance, franchise finance, asset-based lending, commercial real estate, private equity, and sponsor finance industries. It operates approximately 1,200 branches in 14 states and the District of Columbia; 114 retail and commercial non-branch offices in national markets; and approximately 3,300 automated teller machines. The company was formerly known as RBS Citizens Financial Group, Inc. and changed its name to Citizens Financial Group, Inc. in April 2014. Citizens Financial Group, Inc. was founded in 1828 and is headquartered in Providence, Rhode Island.

How the Company Makes MoneyCitizens Financial Group generates revenue primarily through interest income from its lending activities, including personal loans, mortgages, and commercial loans. The company also earns non-interest income from various financial services such as deposit account fees, investment management services, and transaction processing. Additionally, CFG benefits from strategic partnerships and collaborations that enhance its product offerings and customer reach. Key factors contributing to its earnings include effective risk management practices, customer relationship management, and technological investments that enhance operational efficiency and customer experience.

Citizens Financial Financial Statement Overview

Summary

Citizens Financial demonstrates revenue growth but faces challenges with declining operational efficiency and inconsistent cash flows. The balance sheet shows moderate leverage, but a declining ROE suggests reduced efficiency in using equity.

Income Statement

Positive

Citizens Financial shows moderate revenue growth with a 49.60% increase from 2023 to 2024. The net profit margin is healthy at 12.26% for 2024. However, the EBIT margin has decreased to 14.87% from a high of 46.15% in 2022, indicating reduced operational efficiency.

Balance Sheet

Positive

The debt-to-equity ratio is 0.51, reflecting moderate leverage. ROE decreased to 6.22% in 2024, a decline from previous years, indicating less efficient use of equity. The equity ratio of 11.15% suggests a stable financial position but could be improved for better resilience.

Cash Flow

Neutral

Free cash flow is inconsistent, with periods of zero or negative values, indicating potential cash management issues. The operating cash flow to net income ratio is unavailable for 2024, suggesting challenges in cash generation relative to reported profits.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
7.79B	8.22B	8.05B	6.65B	6.91B
	Gross Profit
7.79B	8.22B	8.05B	6.65B	6.91B
	EBIT
1.83B	2.03B	2.65B	2.98B	1.30B
	EBITDA
1.83B	2.51B	3.22B	3.60B	1.88B
	Net Income Common Stockholders
1.51B	1.61B	2.07B	2.32B	1.06B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
32.61B	41.70B	34.59B	34.90B	35.43B
	Total Assets
217.52B	221.96B	226.73B	188.41B	183.35B
	Total Debt
12.40B	13.97B	15.89B	7.01B	8.59B
	Net Debt
12.40B	1.94B	5.04B	-2.47B	-4.45B
	Total Liabilities
193.27B	197.62B	203.04B	164.99B	160.68B
	Stockholders Equity
24.25B	24.34B	23.69B	23.42B	22.67B
Cash Flow		Free Cash Flow
1.88B	2.79B	3.99B	2.15B	-7.00M
	Operating Cash Flow
2.00B	2.96B	4.12B	2.27B	111.00M
	Investing Cash Flow
2.99B	5.25B	-12.64B	-10.49B	-6.14B
	Financing Cash Flow
-6.01B	-7.13B	9.91B	4.64B	15.37B

Citizens Financial Technical Analysis

Technical Analysis Sentiment

Negative

Last Price35.82

Price Trends

50DMA

41.12

Negative

100DMA

43.40

Negative

200DMA

42.16

Negative

Market Momentum

MACD

-1.78

Negative

RSI

41.68

Neutral

STOCH

46.00

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CFG, the sentiment is Negative. The current price of 35.82 is below the 20-day moving average (MA) of 37.44, below the 50-day MA of 41.12, and below the 200-day MA of 42.16, indicating a bearish trend. The MACD of -1.78 indicates Negative momentum. The RSI at 41.68 is Neutral, neither overbought nor oversold. The STOCH value of 46.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CFG.

Citizens Financial Risk Analysis

Citizens Financial disclosed 36 risk factors in its most recent earnings report. Citizens Financial reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Citizens Financial Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FCNCA	77 Outperform	$22.64B	8.90	12.77%	0.43%	18.05%	-75.88%
HBAN	73 Outperform	$19.68B	10.36	10.30%	4.60%	7.89%	17.47%
RF	72 Outperform	$17.29B	9.22	11.33%	5.18%	1.23%	12.14%
KB	71 Outperform	$21.43B	6.12	9.39%	3.28%	-1.25%	6.28%
CFG	64 Neutral	$15.56B	11.76	6.37%	4.87%	-2.52%	13.92%
Sector *	63 Neutral	$12.07B	9.35	8.15%	79.57%	12.85%	-5.13%
KEY	54 Neutral	$15.41B	1,663.64	0.14%	5.95%	-12.30%	-120.41%

* Financial Sector Average

Performance Comparison

CFG

Citizens Financial

35.82

2.24

6.67%

FCNCA

First Citizens BancShares

1,734.53

117.61

7.27%

HBAN

Huntington Bancshares

13.93

0.87

6.66%

Kb Financial Group

58.54

7.71

15.17%

KEY

KeyCorp

14.17

0.16

1.14%

Regions Financial

19.78

1.24

6.69%

Citizens Financial Earnings Call Summary

Earnings Call Date: Apr 16, 2025 | % Change Since: -0.78% | Next Earnings Date: Jul 16, 2025

Earnings Call Sentiment Neutral

The earnings call presented a balanced view with strong performance in net interest margin and Private Bank growth, while acknowledging challenges posed by market uncertainty and slower-than-expected loan growth.

Highlights

Net Interest Margin Expansion

Net Interest Margin (NIM) expanded by 3 basis points to 2.90%, indicating improved profitability from interest-earning assets.

Strong Private Bank Growth

The Private Bank achieved significant growth, reaching $8.7 billion in deposits and $5.2 billion in assets under management (AUM).

Successful Debt Issuance

Issued $750 million in senior debt, strengthening the funding base.

Capital and Liquidity Management

CET1 ratio of 10.6% and LDR of 77.5%, demonstrating strong capital and liquidity positions.

Share Repurchases

Completed $200 million in stock buybacks, taking advantage of strong capital position.

Lowlights

Market Uncertainty Impact

Market uncertainty due to policy decisions and macroeconomic conditions has affected capital markets and deal activity.

Loan Growth Challenges

Potential pushout in capital markets fees and slower loan growth due to economic uncertainty.

Non-Core Loan Sale

Sale of $1.9 billion in non-core student loans with a $25 million charge-off, impacting overall loan portfolio.

Company Guidance

During the Citizens Financial Group's first-quarter 2025 earnings call, several key metrics and financial guidance points were highlighted. The company reported a net interest margin (NIM) expansion of 3 basis points to 2.90% and core loan growth of 1%. The balance sheet remains robust with a Common Equity Tier 1 (CET1) ratio of 10.6% and a loan-to-deposit ratio (LDR) of 77.5%. The bank is strategically selling $1.9 billion in non-core student loans and has already sold $200 million in Q1. The transaction is expected to be accretive to NIM, EPS, and ROTCE. Furthermore, the bank issued $750 million in senior debt, bolstering its funding base. The Private Bank showed significant growth, reaching $8.7 billion in deposits and $5.2 billion in assets under management (AUM). For the full year, the company reaffirmed its EPS estimate and anticipates a pickup in loan demand and deal activity in the latter half of the year, despite the current macroeconomic uncertainties. The guidance reflects potential risks from continued economic uncertainty, with possible offsets including better funding costs and share repurchases.

Citizens Financial Corporate Events

Business Operations and StrategyFinancial Disclosures

Citizens Financial Reports Q1 2025 Earnings and Loan Sale

Neutral

Apr 16, 2025

Citizens Financial Group, Inc. reported a first-quarter 2025 net income of $373 million and earnings per share of $0.77. The company highlighted a strong liquidity profile with a CET1 ratio of 10.64% and a loan-to-deposit ratio of 77.5%. Key developments included an agreement to sell approximately $1.9 billion of non-core education loans, with $200 million settled in the first quarter and the remainder to settle throughout 2025. The company’s financial metrics showed a slight decline in pre-provision net revenue and net interest income, while spot deposits increased by 2% quarter-over-quarter.

Spark’s Take on CFG Stock

According to Spark, TipRanks’ AI Analyst, CFG is a Neutral.

Citizens Financial’s overall score reflects solid financial performance with challenges in operational efficiency and cash flow management. Positive earnings call highlights and attractive valuation support the score, despite technical indicators suggesting caution. Continued focus on growth initiatives and strategic investments may enhance future performance.

To see Spark’s full report on CFG stock, click here.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.