Citigroup Earnings: Four Quarters in a Row of Falling Profit, Stock Bounces
S&P 500 (NYSE:SPY) component Citigroup Inc. (NYSE:C) reported its results for the second quarter. Citigroup is a financial services holding company that provides corporations, governments, and consumers with a broad range of financial products and services.
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Citigroup Inc. Earnings Cheat Sheet
Results: Net income for the banks-major regional fell to $468 million (15 cents per share) vs. $3.34 billion ($1.09 per share) a year earlier. This is a decline of 86% from the year-earlier quarter. Excluding a one-time writedown and an accounting charge for the change in the value of its debt, Citigroup reported adjusted earnings of $3.27 billion.
Revenue: Fell 6.8% to $19.41 billion from the year-earlier quarter.
Actual vs. Wall St. Expectations: Citigroup Inc. reported adjusted net income of $1.06 per share. By that measure, the company beat the mean estimate of 97 cents per share. It beat the average revenue estimate of $18.76 billion.
Quoting Management: Vikram Pandit, Citi’s Chief Executive Officer, said, “Our core businesses showed momentum during the quarter as we increased lending and generated higher operating revenues. These earnings highlight the strength of Citicorp and its diversification by product and region. For the third straight quarter, we had positive operating leverage in each of our three core businesses. Citigroup in total also had positive operating leverage as Citi Holdings had a smaller impact on our overall results.
The company’s net income has now fallen for three straight quarters. In the first quarter, net income fell 2.3% from the year earlier, while the figure fell 27% in the fourth quarter of the last fiscal year.
The company has now topped analyst estimates for the last three quarters. It beat the mark by 7 cents in the first quarter and by 10 cents in the fourth quarter of the last fiscal year.
Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the third quarter has moved down from $1.04 a share to 99 cents over the last ninety days. For the fiscal year, the average estimate has moved down from $4.07 a share to $3.89 over the last ninety days.
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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)
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