C

(Bloomberg) -- Hedge funds are ramping up bearish dollar bets as they await more details on Treasury Secretary Scott Bessent’s new fiscal plan to address the highest borrowing costs in years. Most Read from Bloomberg US Oil Refiners Face Import Squeeze From Biggest Foreign Seller Nvidia Customers Notified About AI-Related Price Hikes Above 15% US-Canada Trade Talks Fell Apart Over Fine Print, Envoy Says Canada Hits Back on US Tariffs as Carney Says ‘At War’ on Trade Leavitt Says She’ll Return to MAGA Inc. After White House That pressure was evident on Friday, when the dollar extended a drop triggered by Bessent’s Aug. 19 decision to increase the size of buybacks for longer-dated securities “by at least double.” The announcement sparked the dollar’s worst single-day decline in nearly three weeks and triggered a wave of selling across the cash market. The dollar was little changed in Asia on Monday. “We’ve seen a pronounced response in particular from hedge fund clients in the linear space, where dollar selling accelerated against a backdrop of persistent dollar supply throughout August,” Torsten Schoeneborn, London-based co-head of G-10 FX trading at Barclays Plc., said on Friday. Real-money flows have been much less directional, he added. Scott Bessent’s aggressive approach to stem the rise in US borrowing costs has some investors saying that the dollar will ultimately pay the price. They expect any pivot toward active yield management by the Treasury to weaken faith in the dollar. Pessimism over the dollar is equally evident in the options market. The premium to hedge the dollar’s downside over the next month relative to its upside has climbed to its highest since February, according to a Bloomberg gauge. “Since the Treasury buyback announcement, we’ve seen broader demand for dollar downside hedges across the FX options market,” said Akshay Saxena, Singapore-based head of FX options trading for Asia at Citigroup Inc. Saxena said that the sharpest repricing occurred in Swiss franc implied volatility, which measures the expected future movement of the currency and directly impacts option premiums. The franc’s one-month implied volatility jumped to an over two-week high last week, while similar metrics for the euro, sterling and the Canadian dollar also moved higher on renewed institutional interest in greenback put structures, he added. Demand for dollar put options versus the euro, which gains in value as the greenback falls, was 47% larger than that of dollar call options on Aug. 21, according to data from the Depository Trust and Clearing Corp. based on contracts valued at $150 million or more. In Asian trading, Saxena said demand has been concentrated on short-dated options — particularly in the Korean won, Thai baht and Singapore dollar — while offshore yuan volatility “has attracted interest” given the currency pair’s proximity to multi-year lows. Most Read from Bloomberg Businessweek The Diamond Industry’s Old Guard Wants You to Buy ‘Natural’ New York’s Israeli Restaurants Are Doing Better Than You Might Think The Seniors Against Senior Housing Group Chats Might Be Full of Affiliate Links Soon Rising Temperatures Are Threatening Some of America’s Best Fishing Destinations ©2026 Bloomberg L.P.

It has been about a month since the last earnings report for The Charles Schwab Corporation (SCHW). Shares have added about 10% in that time frame, outperforming the S&P 500. But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Charles Schwab due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers. Schwab’s second-quarter 2026 adjusted earnings of $1.62 per share outpaced the Zacks Consensus Estimate of $1.53. The bottom line soared 42% year over year.Quarterly results benefited from robust performance of the asset management business and record trading revenues. Higher net interest revenues and solid brokerage account numbers were other positives. However, an increase in expenses was the undermining factor.Results excluded transaction-related costs. After considering these, net income (GAAP basis) was $2.8 billion or $1.54 per share, up from $2.13 billion or $1.08 per share in the year-ago quarter. Quarterly net revenues were a record $7.07 billion, jumping 21% year over year. The increase was driven by higher NIR (up 19%), trading revenue (28%), bank deposit account fees (35%) and asset management and administration fees (16%). The top line easily surpassed the Zacks Consensus Estimate of $6.89 billion.Total non-interest expenses (GAAP basis) increased 12% to $3.4 billion. Excluding non-recurring items, adjusted total expenses were $3.23 billion, up 11% year over year.The pre-tax profit margin (adjusted) increased to 54.3% from 50.1% in the prior-year quarter.At the end of the second quarter, Schwab’s average interest-earning assets rose 5% to $445 billion. As of June 30, 2026, the annualized return on equity was 25%, up from 19% in the prior-year quarter. As of June 30, 2026, Schwab’s total client assets reached a record $13.08 trillion (up 22% year over year). During the reported quarter, net new assets brought by new and existing clients were $118.7 billion.Schwab added 1.4 million new brokerage accounts during the quarter. As of June 30, 2026, the company had 39.8 million active brokerage accounts, 2.4 million banking accounts and 5.9 million corporate retirement plan participants. During the reported quarter, Schwab repurchased 11.2 million shares for $1 billion. Management’s updated 2026 scenario assumes the Fed funds upper bound to end the year at 4%, changed from the previously mentioned 3.75%. Likewise, equity markets are expected to rise 13% from the 2025-end levels, changed from the previously mentioned 10% increase. The updated scenario also includes full-year daily average trades reaching 10.6 million, with organic net asset growth of 5%.Based on these assumptions, Schwab expects 2026 revenue growth of 17.5-18.5%.Average interest-earning assets are expected to expand modestly in the year on a year-over-year basis. NIM is expected to expand to 3-3.10% in 2026, with fourth-quarter NIM reaching 3.25-3.30%.In terms of expenses, Schwab expects adjusted expenses to rise 9.5-10.5% in 2026. Management attributed this to higher volume-related costs tied to strong business performance and trading activity, as well as the inclusion of Forge Global Holdings (acquired in March 2026).The 2026 adjusted pre-tax margin is expected in the low 50% range.The company expects high-single-digit to low-double digit revenue growth coupled with positive operating leverage and balance sheet management to result in mid-teens EPS growth through the cycle. In the past month, investors have witnessed a upward trend in estimates review. Currently, Charles Schwab has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock has a grade of C on the value side, putting it in the middle 20% for value investors. Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Charles Schwab has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months. Charles Schwab belongs to the Zacks Financial - Investment Bank industry. Another stock from the same industry, Citigroup (C), has gained 0.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026. Citigroup reported revenues of $24.77 billion in the last reported quarter, representing a year-over-year change of +14.3%. EPS of $3.15 for the same period compares with $1.96 a year ago. For the current quarter, Citigroup is expected to post earnings of $2.68 per share, indicating a change of +19.6% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.6% over the last 30 days. Citigroup has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Charles Schwab Corporation (SCHW) : Free Stock Analysis Report Citigroup Inc. (C) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

(Bloomberg) -- Alibaba Group Holding Ltd. is reclaiming its place as one of investors’ favorite Chinese technology stocks, on bets it can beat rivals in the combative artificial intelligence market. Most Read from Bloomberg Bessent Deploys Debt Buybacks in Sign of Concern Over Yield Rise Natalie Harp, Trump’s Gatekeeper, Is at Center of Senator Jon Ossoff Clash Moderna and Merck Revive mRNA Hopes With Melanoma Success PlayStation Reboots ‘Horizon Hunters Gathering’ as Live-Service Strategy Struggles US Set to Cut Tariffs on Canada Metals, Autos in Trade Deal Its shares have surged 36% in Hong Kong this quarter, topping the Hang Seng Tech Index in a rally ahead of its results due later Thursday. Alibaba is on track for its biggest quarterly outperformance against Tencent Holdings Ltd. since early 2025. A key difference is that Tencent is focusing its AI strategy on its social media and content businesses while Alibaba spends heavily across its generative model, cloud and chip operations. Alibaba has also started to see accelerating cloud growth. It’s even starting to steal back the spotlight from upstart model makers like Z.AI Co. that captured attention earlier this year. “Alibaba’s AI investments have been effective in reviving both investor interest in the stock and user engagement across its broader ecosystem,” said Gary Tan, a portfolio manager at Allspring Global Investments. Clear chances for the company to make money have “helped rekindle investor interest,” he said. Alibaba was an early winner in China’s AI stock boom but fell behind as competitors gained attention with new listings and technological breakthroughs. Its resurgence comes as a global rush to China’s cheaper AI offerings helps its open-weight Qwen models gain traction with users. Advances in the AI arena have also helped Alibaba reframe its narrative from an online retail giant struggling with sluggish domestic consumption to a winning technology platform. The company is expected to report 8.4% growth in revenue for the June quarter, the fastest in almost three years, according to data compiled by Bloomberg. Analysts project a profit decline amid continued huge outlays on its various businesses. Among peers, Tencent and Baidu Inc. saw their stocks decline in the wake of recent results, which disappointed the market. Alibaba’s earnings may be “better than feared” thanks to narrower losses tied to food delivery and quick commerce investment, along with revenue acceleration and margin increase in its cloud business, JPMorgan Chase & Co. analyst Alex Yao wrote in note. Shares of Alibaba rose as much as 2.3% in Hong Kong on Thursday ahead of its results. Traders have been applauding its AI shift, awarding the stock a consistent valuation premium to Tencent’s this year for the first time in more than a decade. Rapid rollouts from DeepSeek’s V4 to Moonshot AI Inc.’s Kimi K3 are said to be creating a “model‑agnostic” landscape where enterprises pick and choose among different systems based on cost and performance. As such, the battleground is seen shifting to platforms and infrastructure, where Alibaba is seen with an advantage. The company’s cloud operation has established a lead over competitors, with estimates from research Omdia showing it with 37% market share in the fourth quarter of 2025, compared with 17% for Huawei Technologies Co. and 10% for Tencent. Alibaba also designs some of its own chips. That’s on top of its vast product offerings, from the Qwen app for consumers to coding tools and enterprise agents for developers. “We believe long-term success will require immense resources and a loyal customer base,” Citigroup Inc. analyst Alicia Yap wrote in note. “Consequently, companies with full-stack capabilities, from chips and cloud infrastructure to models and applications, like Alibaba, are better positioned to lead.” (Updates data as of Thursday’s early trading) Most Read from Bloomberg Businessweek The Diamond Industry’s Old Guard Wants You to Buy ‘Natural’ The Midwest City Keeping the American Dream Alive for First-Time Homebuyers China’s Chip Industry Is Having a Breakout Moment The Seniors Against Senior Housing Big Pharma Is Hooked on Chinese Licensing Deals ©2026 Bloomberg L.P.

JPMorgan JPM raised its 2026 net interest income (NII) outlook after a strong second quarter, signaling that balance sheet growth is helping offset what was previously expected to be a more pronounced rate-driven headwind. The update comes at a time when the Federal Reserve has paused its easing cycle and adopted a more hawkish tone, citing persistent inflation pressures.The bank now expects NII of about $105.5 billion, up from the previously targeted $103 billion. NII excluding Markets is projected at approximately $96.5 billion compared with the earlier estimate of $95 billion. The upward revision is notable because it suggests JPMorgan is less exposed to near-term rate uncertainty than initially assumed.The macro backdrop is important here. With the Fed signaling that rates may stay higher for longer or even move higher if inflation re-accelerates, banks face a more complex environment. While higher rates can support asset yields, they also risk slowing loan demand and increasing deposit competition. JPMorgan’s guidance implies that strong loan growth and resilient deposit inflows are currently outweighing those pressures.In the second quarter, average loans rose 10% year over year and deposits increased 7%, helping stabilize NII even as earlier expectations assumed rate cuts would weigh on earnings. Growth in card revolving balances and wholesale lending also provided support. However, the higher NII outlook will not fully translate into profit expansion. JPM also raised its 2026 adjusted expense forecast to about $107.5 billion, reflecting higher activity-driven costs.The revised outlook highlights JPMorgan’s ability to generate earnings resilience in a “higher-for-longer” rate environment. Still, the key variables for investors remain the Fed’s inflation response, deposit pricing dynamics, and whether loan growth can continue if financial conditions tighten further. Two peers of JPMorgan are Citigroup C and Bank of America BAC. Citigroup’s NII recorded a three-year CAGR of 6.2% through 2025, with the uptrend continuing in the first half of 2026. The company continues to witness solid growth in loan and deposit balances. Citigroup expects NII, excluding Markets, to increase 5-6% in 2026, supported by loan growth and stabilizing funding dynamics.Bank of America is well-positioned to deliver continued growth in NII. Over 2020–2025, NII witnessed a CAGR of 6.7%, with the momentum extending into the first half of 2026. Bank of America expects 2026 NII (FTE) to grow at the upper end of the 6-8% range, reflecting confidence in the durability of this revenue stream. JPM’s shares have gained 10.9% so far this year. Image Source: Zacks Investment Research From a valuation standpoint, JPMorgan trades at a 12-month trailing price-to-tangible book (P/TB) of 3.33X, above the industry average. Image Source: Zacks Investment Research The Zacks Consensus Estimate for JPMorgan's 2026 earnings suggests a 22.6% rise on a year-over-year basis, while 2027 earnings are expected to grow at a rate of 0.3%. In the past month, earnings estimates for 2026 and 2027 have moved upward to $24.93 and $25.02, respectively. Image Source: Zacks Investment Research JPMorgan currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report Bank of America Corporation (BAC) : Free Stock Analysis Report Citigroup Inc. (C) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the diversified banks industry, including Citigroup (NYSE:C) and its peers. At their core, diversified banks take in deposits and engage in various forms of lending, which means revenue is generated through interest rate spreads (difference between loan and deposit rates) and fees. Other revenue comes from adjacent services such as wealth management, card and account fees, and products such as annuities. These institutions benefit from rising interest rates that improve NIMs (net interest margins), digital transformation reducing operational costs, and expanding wealth management services as populations age. However, they face headwinds including fintech competition disrupting traditional models (how disruptive is crypto?), stringent regulatory requirements increasing compliance costs, and cybersecurity threats requiring substantial technology investments. Economic downturns also pose risks through potential loan defaults and compressed margins during accommodative monetary policy periods. The 7 diversified banks stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.6%. In light of this news, share prices of the companies have held steady as they are up 3% on average since the latest earnings results. With operations in nearly 160 countries and a history dating back to 1812, Citigroup (NYSE:C) is a global financial services company that provides banking, investment, wealth management, and payment solutions to consumers, corporations, and governments. Citigroup reported revenues of $24.79 billion, up 14.3% year on year. This print exceeded analysts’ expectations by 4.5%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ net interest income and EPS estimates. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 2.1% since reporting and currently trades at $137.82. Is now the time to buy Citigroup? Access our full analysis of the earnings results here, it’s free. Founded during the California Gold Rush in 1852 to provide banking and express delivery services to miners and merchants, Wells Fargo (NYSE:WFC) is a diversified financial services company that provides banking, lending, investment, and wealth management services to individuals and businesses. Wells Fargo reported revenues of $22.7 billion, up 8.6% year on year, outperforming analysts’ expectations by 3.9%. The business had a very strong quarter with a beat of analysts’ EPS and tangible book value per share estimates. The market seems content with the results as the stock is up 1.6% since reporting. It currently trades at $89.09. Is now the time to buy Wells Fargo? Access our full analysis of the earnings results here, it’s free. With roots dating back to 1863 and a presence across 26 states primarily in the Midwest and West, U.S. Bancorp (NYSE:USB) is one of America's largest banks providing lending, deposit services, wealth management, payment processing, and merchant services to individuals and businesses. U.S. Bancorp reported revenues of $7.76 billion, up 9.9% year on year, exceeding analysts’ expectations by 2.1%. Still, it was a mixed quarter as it posted a miss of analysts’ tangible book value per share estimates. Interestingly, the stock is up 3.4% since the results and currently trades at $65.16. Read our full analysis of U.S. Bancorp’s results here. Tracing its roots back to 1852 when Pittsburgh's industrial boom demanded stronger financial institutions, PNC (NYSE:PNC) is a diversified financial institution that provides retail banking, corporate banking, and asset management services through a coast-to-coast branch network. PNC Financial Services Group reported revenues of $6.68 billion, up 17.5% year on year. This print surpassed analysts’ expectations by 3.8%. It was a strong quarter as it also put up a beat of analysts’ EPS estimates and net interest income in line with analysts’ estimates. The stock is up 1% since reporting and currently trades at $254.50. Read our full, actionable report on PNC Financial Services Group here, it’s free. Born from the 2019 merger of BB&T and SunTrust in one of the largest banking combinations since the 2008 financial crisis, Truist Financial (NYSE:TFC) is a bank holding company that offers a wide range of financial services including consumer and commercial banking, wealth management, insurance, and lending solutions. Truist Financial reported revenues of $5.31 billion, up 5.1% year on year. This number beat analysts’ expectations by 1.5%. Zooming out, it was a mixed quarter as it also logged a beat of analysts’ EPS estimates but a miss of analysts’ net interest income estimates. Truist Financial had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is down 1.1% since reporting and currently trades at $52.65. Read our full, actionable report on Truist Financial here, it’s free. Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership. Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products. By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals. Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

Citi continues to see a path for the S&P 500 to reach 8,100 by year-end after raising its full-year earnings forecast following a stronger-than-expected second-quarter reporting season. Strategists led by Scott Chronert said the fundamental forces underpinning the target “remain mostly in place,” although the next stage of the rally will likely require broader market participation and sustained confidence in artificial intelligence-related earnings. Citi increased its full-year S&P 500 earnings estimate to $365 from $350 following second-quarter corporate results. Despite the earnings upgrade, the bank left its year-end index target unchanged at 8,100. The strategists believe improving sales growth, continued margin expansion and a broadening equity rally provide support for that forecast. Expectations that investors will increasingly price out further Federal Reserve rate hikes could also create a more favourable environment for equities. Citi believes the rally is already expanding beyond the stocks that previously dominated index gains and expects this trend to continue. The path towards 8,100 depends partly on soft-landing expectations, a reset within technology stocks and renewed confidence in the fundamental strength of companies benefiting from artificial intelligence. A “goldilocks” macroeconomic environment, combining continued economic growth with manageable inflation and less restrictive monetary policy, would provide an important foundation for broader participation. Without that broadening, further gains could remain overly dependent on a relatively small group of large companies. Artificial intelligence remains a crucial component of Citi’s outlook. The bank expects revenue trends among companies spending heavily on AI capital expenditure to provide a floor for the AI-driven portion of the S&P 500 “for now.” Strong investment in data centres, semiconductors and related infrastructure has helped underpin earnings expectations for many of the largest technology companies. However, Citi stressed that the AI-related group remains “critical to further index upside.” “Here, the issue is one of confidence in duration/persistence of current fundamental strength.” Investors will therefore need evidence that the current AI earnings cycle can continue rather than proving to be a shorter-lived surge. Positive earnings surprises during the second quarter were slightly stronger than Citi had anticipated under a typical reporting-season pattern. However, the strategists cautioned that part of the improvement in consensus earnings resulted from asset writeups at certain megacap companies. Those gains “cannot be directly attributed to operating performance,” meaning headline earnings growth may overstate the underlying improvement in corporate fundamentals. Citi nevertheless sees the broader earnings backdrop as strong even after accounting for these non-operating contributions. At the index level, revenue growth has accelerated while corporate margins have expanded further. Together, those trends have produced an improvement in earnings growth that Citi said “looks more akin to post-recession circumstances.” The comparison suggests corporate profitability is showing unusually strong momentum, although the bank again stressed the need to distinguish operating improvements from non-operating factors such as asset revaluations. Even with that qualification, Citi believes the fundamental environment remains supportive for equities. One potential concern is that the improvement in S&P 500 earnings expectations has been dominated by a relatively small number of companies. Consensus index earnings have increased from $312 at the beginning of the year to $361, a rise of $49. Just 20 stocks accounted for $45 of that increase, demonstrating how concentrated the earnings upgrade cycle has been. Full-year consensus earnings have also risen by $20 since the end of the second quarter, but only $3 of that improvement reflects revisions to third- and fourth-quarter forecasts. This suggests much of the recent optimism is linked to already-reported results rather than substantially stronger expectations for the remainder of the year. Citi described the earnings tailwinds supporting equities as “undeniable,” but highlighted several qualifications. Asset writeups have inflated some headline earnings figures, while third- and fourth-quarter estimates have not yet experienced the same degree of improvement as second-quarter results. At the same time, earnings upgrades remain concentrated among a small number of large companies. These factors mean continued market gains will increasingly depend on stronger earnings participation across the wider index. Citi’s unchanged 8,100 target reflects confidence that the fundamental backdrop remains strong enough to support further S&P 500 gains. Higher earnings estimates, improving revenue growth and expanding margins provide a favourable foundation, while expectations for fewer Fed rate hikes could support valuations. However, the bank’s outlook increasingly depends on the rally becoming broader and the AI-driven segment maintaining its fundamental momentum. If a soft landing, supportive monetary environment and continued AI investment combine with stronger earnings across a wider range of companies, Citi believes the S&P 500 remains on course for 8,100. Get stock prices from InvestorsHub

Citigroup recently reported second-quarter 2026 earnings per share of US$3.15, above estimates, alongside multiple new fixed‑income offerings and further expansion of its institutional and consumer franchises through mandates, acquisitions and leadership hires. By securing a full middle office mandate from Aegon Asset Management covering US$380.00 billion in assets and agreeing to acquire rewards platform Kard Financial, Citi is deepening its role in both large‑scale institutional infrastructure and data‑driven consumer engagement. We’ll now examine how Citi’s stronger‑than‑expected quarterly results and the Aegon Asset Management middle office mandate affect its investment narrative. AI is about to change healthcare. These 44 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early. To own Citi, you need to believe its global banking, cards and services platform can convert scale into better returns while managing heavy regulatory and transformation demands. The latest earnings beat reinforces the near term catalyst of execution on cost and efficiency targets, while persistent regulatory scrutiny and transformation expenses remain the biggest risk. The Aegon middle office win and recent fixed income issuance support the story, but do not fundamentally change that risk balance. Among the recent announcements, the full middle office mandate for Aegon Asset Management, covering US$380.00 billion of assets and extending a 20 year relationship, looks most relevant. It underscores Citi’s role as a core infrastructure provider in securities services, which ties directly into the investment narrative around scale, fee income and digital capabilities, and may help offset some of the revenue concentration and restructuring risks investors worry about elsewhere in the group. Yet investors should not overlook how ongoing regulatory scrutiny and high transformation costs could still affect... Read the full narrative on Citigroup (it's free!) Citigroup's narrative projects $106.2 billion revenue and $21.9 billion earnings by 2029. This requires 9.1% yearly revenue growth and a $5.4 billion earnings increase from $16.5 billion. Uncover how Citigroup's forecasts yield a $154.00 fair value, a 11% upside to its current price. Some of the lowest analysts were assuming Citi’s revenue would reach about US$102.9 billion and earnings about US$20.8 billion by 2029, yet they still saw macro, regulatory and card credit risks as strong enough to cap valuation. Compared with the current focus on earnings momentum and mandates like Aegon’s, this is a much more pessimistic view, and the latest results and deals may well push you to reassess which side of that debate you find more convincing. Explore 5 other fair value estimates on Citigroup - why the stock might be worth as much as 43% more than the current price! Don't just follow the ticker - dig into the data and build a conviction that's truly your own. A great starting point for your Citigroup research is our analysis highlighting 4 key rewards that could impact your investment decision. Our free Citigroup research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Citigroup's overall financial health at a glance. The market won't wait. These fast-moving stocks are hot now. Grab the list before they run: Explore 25 top quantum computing companies leading the revolution in next-gen technology and shaping the future with breakthroughs in quantum algorithms, superconducting qubits, and cutting-edge research. We've uncovered the 11 dividend fortresses yielding 5%+ that don't just survive market storms, but thrive in them. The latest GPUs need a type of rare earth metal called Terbium and there are only 28 companies in the world exploring or producing it. Find the list for free. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include C. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

A month has gone by since the last earnings report for Citigroup (C). Shares have added about 2% in that time frame, underperforming the S&P 500. Will the recent positive trend continue leading up to its next earnings release, or is Citigroup due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts. Citigroup reported second-quarter 2026 earnings per share of $3.15, which surpassed the Zacks Consensus Estimate of $2.72. In the prior-year quarter, the company reported earnings per share of $1.96. The company’s results benefited from a year-over-year rise in NII and growth across each of its five core businesses. Citigroup also registered a year-over-year increase of 44% in investment banking revenues and positive operating leverage. However, higher operating expenses and a weaker capital position acted as offsetting factors. Net income in the quarter was $5.8 billion, up 45.1% from the prior-year quarter. Revenues, net of interest expenses, were $24.8 billion in the second quarter of 2026, up 14.3% year over year. The top line surpassed the Zacks Consensus Estimate by 4.6%. NII rose 12.8% year over year to $17.1 billion, while non-interest revenues increased 17.7% to $7.6 billion. Citigroup’s operating expenses increased 4.7% year over year to $14.2 billion. The rise was driven by higher compensation and benefits, transactional and product servicing expenses, deposit insurance costs and the impact of foreign exchange translation, partly offset by lower professional services expenses. In the Services segment, total revenues, net of interest expenses, were $6.4 billion, up 17.5% year over year. The increase reflected growth in Treasury and Trade Solutions and Securities Services. The Markets segment’s revenues increased 17.2% year over year to $7 billion, driven by growth in Fixed Income and Equity markets revenues. Banking revenues were $1.9 billion, up 34% year over year, primarily driven by a rise in Investment Banking revenues. Debt Capital Markets revenues rose 65% and Equity Capital Markets revenues surged 92%, while Advisory revenues declined 4%. In the Wealth segment, revenues were $3.2 billion, rising 12.9% year over year. The increase was driven by growth across Citigold and Retail Banking, the Private Bank and Wealth at Work. U.S. Consumer Cards revenues were $4.5 billion, up 1.1% year over year, driven by higher NII on increased interest-earning balances, largely offset by lower non-interest revenues. In the All Other segment, on a managed basis, revenues were $1.7 billion, up 1.2% year over year. At the end of the second quarter of 2026, the company’s deposits rose 3.2% from the prior quarter to $1.49 trillion. Its loans also increased 4.2% on a sequential basis to $793.6 billion. Total non-accrual loans decreased 3.7% year over year to $3.2 billion. Total allowance for credit losses was $22.2 billion at the quarter-end, down from $23.7 billion in the prior-year period. Provisions for credit losses and benefits, and claims were $2.5 billion in the quarter, down 12.2% year over year. At the end of the second quarter of 2026, Citigroup’s Common Equity Tier 1 capital ratio was 12.8%, down from 13.5% in the second quarter of 2025. The company’s supplementary leverage ratio in the reported quarter was 5.2%, down from the prior-year quarter’s 5.5%. During the quarter, Citigroup returned nearly $5 billion to common shareholders through share repurchases and dividends. Management expects NII (excluding Markets) to increase 5-6% on a year-over-year basis in 2026. Management anticipates an efficiency ratio of 60% in 2026, with another year of positive operating leverage. Management continues to target a return on tangible common equity (RoTCE) of 10-11% in 2026. U.S Cards net credit loss (NCL) as a percentage of average loans is expected to be 4-4.5%. In 2025, U.S. Cards NCL was 4.1%. The company also plans to continue share repurchases under its $30-billion authorization, with 2026 buybacks expected to exceed the 2025 level. Near-Term Outlook (2027-2028) Citigroup expects revenues, excluding Legacy Franchises and reconciling items, to see a mid-single-digit CAGR from 2025 through 2028. The efficiency ratio is targeted at 55-60%, excluding notable items, while RoTCE is expected to be within 11-13% in both 2027 and 2028, moving toward the upper end of the range in 2028. Medium-Term Outlook (2029-2031) Citigroup targets an efficiency ratio of below 55% and RoTCE of 14-15% over the medium term. In the past month, investors have witnessed a upward trend in estimates review. Currently, Citigroup has a subpar Growth Score of D, a score with the same score on the momentum front. Following the exact same course, the stock was allocated a score of D on the value side, putting it in the bottom 40% for this investment strategy. Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. It comes with little surprise Citigroup has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Citigroup Inc. (C) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

(Bloomberg) -- A rotation into China’s biggest tech firms from AI infrastructure stocks will be tested this week as earnings are due. Most Read from Bloomberg Five Takeaways From Zuckerberg’s 6,500-Word Manifesto on AI Pakistan Says Deal Is Close Even as Iran, US Harden Stances China Unleashes $28 Trillion Capital Markets to Challenge US in AI Nvidia Taps Wall Street for $500 Billion Funding Commitment Apple’s Glass-Centric 20th-Anniversary iPhone Remains on Track for 2027 Results from Tencent Holdings Ltd. and JD.com Inc., due Wednesday and Thursday respectively, will offer an early look at whether stronger core businesses can cushion the impact of rising AI spending, while Semiconductor Manufacturing International Corp.’s outlook may provide clues on chip demand. The reports may signal if market leadership stays with internet platforms or swing back to chipmakers. A broader shift into internet and consumer stocks has gathered pace since late June as the artificial intelligence rally cooled, reversing some of the market’s first-half trends. JD.com and Alibaba Group Holding Ltd. have been the top performers on the benchmark Hang Seng Index since the start of July after lagging in the first six months, while SMIC has moved in the opposite direction. “It’s quite possible it will continue,” Leonid Mironov, portfolio manager at Gavekal Capital Ltd., said of the rotation. “Alibaba and Tencent offer a very different positioning in the AI space than SMIC and other semiconductor names. Investors need to make up their mind which one is preferable.” Analysts say profitability outlooks for internet companies are improving. JD.com is likely to report an 18% year-on-year increase in non-GAAP net profit for the second quarter to 8.7 billion yuan ($1.29 billion), supported by a meaningful narrowing of its food delivery loss with a more rational competitive backdrop, according to HSBC Holdings Plc. Peer Meituan may also report results that are slightly ahead of forecasts as losses narrow faster than expected amid easing subsidy intensity, Citigroup Inc. analysts wrote in a note. On the other hand, SMIC may face hurdles in meeting its guided margins of 20% to 22%, according to Bloomberg Intelligence, though sales for the second quarter is expected to grow 14% to 16% from the prior three months. Investors will be keeping an eye on third-quarter guidance for signs that margin gains and recent price increases are sustainable. Not all internet companies are likely to benefit equally. “We expect dispersion among China internet names, because the market will reward companies that can convert investment into earnings and defend margins, rather than simply announce a larger capex budget,” said Song Zhe, senior investment specialist at BNP Paribas Asset Management. Investors will be watching AI-related capital spending plans closely after a pullback in chipmakers that had rallied on expectations of stronger outlays by Chinese hyperscalers. “If internet companies signal a heavier investment phase alongside a softer outlook for their core consumer facing businesses, semiconductor names could regain leadership as investors refocus on AI infrastructure growth,” said Gary Tan, a portfolio manager at Allspring Global Investments. --With assistance from Jeanny Yu. Most Read from Bloomberg Businessweek Supercharged by Social Media, the GLP-1 Boom Is Warping Teen Psyches ICE Arrests Are Pushing Immigrant Families Deeper Into Poverty Lululemon Is At War With Itself With EV Sales Slowing, Hybrid Cars Are Hot Again Canada Stares Down ‘Quebexit’ Risk ©2026 Bloomberg L.P.