Citizens Financial Group has been treading water for the past six months, recording a small loss of 2.9% while holding steady at $42.75.
Is there a buying opportunity in Citizens Financial Group, or does it present a risk to your portfolio? Get the full stock story straight from our expert analysts, it’s free.
Why Is Citizens Financial Group Not Exciting?
We don't have much confidence in Citizens Financial Group. Here are three reasons why you should be careful with CFG and a stock we'd rather own.
1. Net Interest Income Points to Soft Demand
Markets consistently prioritize net interest income growth over fee-based revenue, recognizing its superior quality and recurring nature compared to the more unpredictable non-interest income streams.
Citizens Financial Group’s net interest income has grown at a 5.3% annualized rate over the last four years, worse than the broader bank industry.
2. EPS Trending Down
We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.
Sadly for Citizens Financial Group, its EPS declined by 3.6% annually over the last five years while its revenue grew by 3.5%. This tells us the company became less profitable on a per-share basis as it expanded.
3. Substandard TBVPS Growth Indicates Limited Asset Expansion
In the banking industry, tangible book value per share (TBVPS) provides the clearest picture of shareholder value, as it focuses on concrete assets while excluding intangible items that may not hold value during challenging times.
To the detriment of investors, Citizens Financial Group’s TBVPS grew at a tepid 7.4% annual clip over the last two years.
Final Judgment
Citizens Financial Group isn’t a terrible business, but it isn’t one of our picks. That said, the stock currently trades at 0.8× forward P/B (or $42.75 per share). While this valuation is optically cheap, the potential downside is big given its shaky fundamentals. We're pretty confident there are superior stocks to buy right now. Let us point you toward one of our top digital advertising picks.
Stocks We Like More Than Citizens Financial Group
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
