Citigroup Inc. (C), JPMorgan Chase & Co. (JPM), Wells Fargo & Co (WFC): Banking On, Well, Banking

Page 1 of 2

Citigroup Inc (NYSE:C)One of the great turnaround stories that’s still taking shape is Citigroup Inc. (NYSE:C). With all the talk surrounding the mixed results of the housing market and the auto industry in full-fledged rebound mode, much of the spotlight has been taken off the financials. I plan to re-aim this spotlight.

Before the financial crisis, Citigroup Inc. (NYSE:C) traded at a premium to both JPMorgan Chase & Co. (NYSE:JPM) and Bank of America Corp (NYSE:BAC) on a price-to-book basis; now the company trades at a steep discount to JPMorgan Chase & Co. (NYSE:JPM) and inline with Bank of America Corp (NYSE:BAC).



I think Citigroup Inc. (NYSE:C) is still in full turnaround mode and presents investors the best upside of all the major banks. The bank should trade more inline with JPMorgan and other top banks over the long term.

JPMorgan Chase & Co. (NYSE:JPM) is one of the top-three banks by assets. In March, the Fed approved the company’s capital deployment plan. JPMorgan now has a $6 billion stock- repurchase program in place.

JPMorgan Chase & Co. (NYSE:JPM) is also slashing jobs to boost profitability. The bank will eliminate 19,000 jobs by the end of 2014. With the help of job cuts, the bank is calling for net income of $27.5 billion in 2014.

Revenue is expected to be up 2% in 2013, after flat revenue growth in 2012. The top line is expected to be weak due to lower trading revenue. Earlier this month, the bank posted 2Q EPS of $1.60 versus $1.21 for the same period last year. Yet, total loans remained flat year-over-year, with the net interest margin falling. So, the bank is still seeing modest growth, but not enough to justify a premium to Citi.

The mortgage bank

Wells Fargo & Co (NYSE:WFC) is still the U.S.’ leading bank for mortgages. The company got a nice uptick in earnings and loan volume related to mortgage refinancing, but as this market cools, so should Wells Fargo.

Wells Fargo & Co (NYSE:WFC) has a target return on assets of 1.3% to 1.6% and return on equity of 12% to 15%. As well, the bank is looking to international markets to help boost its business model, specifically in the asset management sector.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!