In 2025, the US banks are expected to be hit by the Trump tariffs as well as the fears that an economic downturn is imminent.
Wells Fargo’s Mike Mayo says that despite recent weakness in the market, it is still worth purchasing Citigroup Inc. (NYSE: C).
Mayo believes Citi will benefit from the new tariffs.
In a Monday research note, the analyst argued that a near 20% drop in its share price from mid-February created an opportunity to long-term buyers to purchase a high-quality brand at a discount.
Citi is a company that has always benefited from tariffs
Mike Mayo, despite the recent drop in bank stock prices, continues to grade Citigroup as “overweight”. He sees a rise in Citigroup’s shares up to $110 which would indicate a possible upside of 60%.
He recommended that investors take advantage of the current weakness in Citi’s stock, which is currently trading at an enormous discount.
Analysts took comfort in the fact Citi benefited from tariffs when Trump was president before, since it is a “global intermediary” across all regions. They added that this “is important at a moment when their buybacks can go even further at 3/4 tangible book value.”
Wells Fargo’s analyst says that Citi stocks, with their 3.2% dividend yield and current price levels are even more attractive to buy.
What other factors could affect Citistock in 2025
Mayo is still a bullish Citigroup Inc., as he believes the company will switch from “value destruction” to “value creation” in 2026.
Wells Fargo’s analyst believes that deregulation could benefit Citi in 2025, despite recent losses for bank stocks under Trump.
Scott Bessent, the US Treasury secretary will eliminate the red tape and put the banks in control of their lending decisions.
Even though the shares have recently been sold off, they are still close to 25 percent higher than their 52-week-low.
Citi beats expectations in Q4 fiscal
Mike Mayo is still positive on Citi stocks, despite the fact that it has reported strong results in its fourth quarter for January.
Citigroup’s fiscal Q4 saw it swing to profit, and beat estimates both on the top line and bottom line.
Jane Fraser, the chief executive at that time, told investors what she said:
It is important to me that this business has the capacity to grow and prosper over time.
Our shareholders will benefit from increased returns, as we aim to deliver the full potential of Citi.
Citigroup, which avoided one of banking’s biggest blunders in history by avoiding a major mistake recently announced an enormous $20 billion stock purchase program.
Mark Mason, the chief financial officer of its company, said that about $1.5 billion will be implemented in Q1.
The post US Bank Stocks Could Benefit from Trump Tariffs could be updated as new information unfolds.
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