Why is Citigroup Inc. stock outperforming the market?

Citigroup Inc. reported a strong financial performance in the fourth quarter of fiscal 2024, with a 12% increase in revenue to $19.58 billion, surpassing analyst expectations. The company's earnings per share (EPS) reached $1.34, exceeding the anticipated $1.22, and marking a significant turnaround from the previous year's net loss to a net income of $2.9 billion. Citigroup announced a new $20 billion share buyback program, which has been well-received by analysts. The company's operating expenses decreased by 18% year over year, contributing to its improved financial results. For fiscal 2025, Citigroup projects revenue between $83.5 billion and $84.5 billion, above the consensus estimate. Analysts have responded positively to Citigroup's performance and strategic initiatives, with Richard Ramsden from Goldman Sachs, David Konrad from Keefe, Bruyette & Woods, and John McDonald from Truist maintaining positive ratings and some raising their price targets. Key drivers of Citigroup's revenue beat include improved net interest income and trading results. Analysts from Truist Securities anticipate benefits from loan growth and a steeper yield curve. However, Citigroup faces challenges with profitability and asset utilization, as its net margin, return on equity (ROE), and return on assets (ROA) are below industry standards, and its debt-to-equity ratio is higher than average. Despite these challenges, the overall sentiment remains positive, with several analysts raising their price targets and ratings based on Citigroup's recent performance and future prospects.