Latest news with #Citi
Yahoo
6 hours ago
- Business
- Yahoo
BofA analyst raises price target for Citi to $100, takes bullish view of Fraser's restructuring
It's been three years since Jane Fraser unveiled her strategic vision for Citi and, during that time, the CEO has come under significant criticism for her overhaul of the country's third biggest bank. But a Bank of America analyst thinks Fraser is giving the bank a shot at becoming competitive, according to a June 26 research note. With $2.5 trillion in total assets, Citi is one of the nation's largest banks, employing around 229,000 full-time workers as of last year. Fraser took over as Citi CEO in March 2021, and is widely considered the most powerful woman on Wall Street. (This year, Fraser ranked as the third most powerful woman in business, according to Fortune's Most Powerful Women's list.) Citi's stock has gained about 22% since she joined the bank. Citi is no stranger to overhauls. In the late 1990s, the bank underwent a major realignment after Citicorp's merger with Travelers which created Citigroup. Citi reorganized again after the 2008 financial crisis and then, in 2019, it undertook another restructuring. Fraser has come under considerable scrutiny for the latest Citi revamp. She's faced pressure from analysts, regulators and even internal dissent. But Ebrahim Poonawala, a BofA research analyst, thinks 'this time is different,' which is the title of his June 26 note. 'We consider Citi's turnaround as among the most complex in the corporate world, but Fraser had undertaken actions (such as international consumer exits, balance sheet de-risking, tech/personnel investments, streamlining businesses, hiring external talent) that gives Citi a fighting chance of becoming competitive, in our view,' Poonawala wrote in the note. Poonawala reiterated a 'Buy' rating for Citi and boosted his price target to $100 from $89. Fraser's big moves at Citi include divesting nearly all of Citi's international consumer banking franchises, exiting non-core operations, and overhauling leadership. Last year, Citi hired Vis Raghavan, ex-head of global investment banking at JPMorgan Chase executive, to lead global banking. It also added Tim Ryan, of PwC, to lead technology and business enablement, as well as Andy Sieg, of Merrill Wealth Management, to head up wealth. Over the past year, Citi's five businesses are tracking improved profitability, Poonawala said, adding that wealth and banking have acquired a sharper focus under new leadership. Absent a severe macroeconomic shock, the analyst expects Citi's momentum to continue, 'paving the way for management to deliver a more than 10% return on tangible common equity (ROTCE) on a sustainable basis starting in 2026.' ROTCE is a metric used to compare banks and how well they are using tangible common equity to generate profits. In the first quarter, Citi's efficiency ratio in each of its core business units declined versus the year ago quarter, Poonawala said. This reflects management's focus on controlling expenses, he said. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
San Francisco Chronicle
12 hours ago
- Business
- San Francisco Chronicle
California budget comes down to the wire as Newsom, lawmakers face off over housing
SACRAMENTO — California lawmakers are scheduled to pass a budget that rolls back health care benefits for undocumented immigrants and makes other cuts, even as they continue to negotiate with Gov. Gavin Newsom over housing policies that have so far prevented them from reaching a final deal. The housing policies at issue would represent some of the most significant reforms to the state's landmark environmental law, the California Environmental Quality Act, known as CEQA, since its inception. They would grant broad exemptions to CEQA for homes and other buildings in already developed areas. The lawmakers who crafted the original proposals argue that the law has been abused by people trying to block development and that building more homes in already densely populated areas where people live and work is good for the environment. Newsom agreed, and has made his signature on the budget contingent on lawmakers agreeing to enact some of the CEQA exemptions. But when the negotiated language was released earlier this week, it drew swift backlash, especially from labor unions. Lorena Gonzalez, who leads the California Labor Federation, criticized the proposal because she said it did not require high enough wages for construction workers who build the projects allowed under the bill. For years, bills meant to kickstart housing construction have been stymied by labor unions' insistence on provisions that would effectively require that new homes be built by union workers or ones paid what developers often describe as prohibitively high wages. The budget bill lawmakers plan to pass Friday contains a clause that would render it inoperative if lawmakers don't also approve much of the CEQA overhaul that Newsom has called for. The budget deal makes up for a projected $12 billion shortfall in part by taking out billions of dollars in loans and taking money from the state's reserves. It also partially scales back the state's health care coverage for undocumented people who make less than 138% of the federal poverty level. It will freeze enrollment for the program starting next year and will charge undocumented people ages 19-59 $30 per month in premiums starting in 2027. Growing health care costs, in addition to the economic toll from import taxes imposed by President Donald Trump, made the state's budget outlook particularly challenging this year. 'We had to make some very difficult decisions to balance this budget,' Erika Li, a top budget official for the Newsom administration, told lawmakers during a committee hearing earlier this week. Republicans criticized some of the borrowing and budgeting techniques Newsom and lawmakers used to balance the budget, arguing there should have been more cuts given the economic uncertainty in the years ahead. 'This budget that we see today, to the extent that I can understand it, still has a large dose of hope for a miracle, and it is seemingly less likely,' Sen. Roger Niello, R-Fair Oaks, said during the committee hearing. Cities and counties, meanwhile, have criticized the agreement for not providing more funding for reducing homelessness and implementing Proposition 36, which increased penalties for drug and theft crimes. The budget does include a $750 million loan for struggling Bay Area transit agencies and an expansion of the state's film tax credit program to $750 million to try to keep the industry in California.
Yahoo
13 hours ago
- Business
- Yahoo
S&P 500 Roars Back 23%--Wall Street's Wildest Rebound Since Trump's Tariff Shock
The S&P 500 (SPY) just punched through a new record, officially logging a 23% rebound from its April low. What changed? Trump dialed back the tariff chaos, claiming a trade deal with China has been signed, and the U.S. helped broker a ceasefire between Israel and Iranboth of which took pressure off oil markets and global nerves. Add in better-than-expected earnings and a surge of buybacks, and suddenly investors are back in risk-on mode. After a brutal selloff triggered by Trump's liberation day tariffs earlier this year, markets are now pivoting hard toward AI, resilience, and growth. Warning! GuruFocus has detected 7 Warning Sign with C. The rally's engine? Tech and industrials. Tesla (TSLA) bounced alongside high-beta names like Palantir (NASDAQ:PLTR), Robinhood (NASDAQ:HOOD), and Super Micro (NASDAQ:SMCI) all ripping since Trump's U-turn on April 9. On the industrials front, Howmet Aerospace (NYSE:HWM) is up 62%, while Uber (NYSE:UBER) and GE Vernova (NYSE:GEV) have each jumped 54% year-to-date. Even defensive plays like RTX (NYSE:RTX) and Deere (NYSE:DE) joined the party. According to Barclays and Citi, investors now believe the worst of the trade fear is in the rearview mirror. Citi's team even sees another 2.5% upside by year-end 2025 as AI tailwinds keep sentiment strong. Still, not everyone's sold. Credit cracks are showingbank lending is slowing, and delinquencies are ticking up. Morgan Stanley's Lisa Shalett warns the market's now even pricier than it was back in January when you measure it by forward earnings. Her take? Peak pessimism might be behind us, but we're not back to easy street just yet. But here's the kicker: traders aren't flinching. Volatility has collapsed, retail is buying the dip, and no one seems to care about tariffs anymore. The market doesn't discount the same event twice, Shalett said. Right now, it's growth seasonand the tape is acting like it. This article first appeared on GuruFocus.
Business of Fashion
16 hours ago
- Business
- Business of Fashion
Nike Fourth-Quarter Sales Fall by Less Than Expected
Nike said it would cut its reliance on production in China to mitigate the impact from US tariffs on imports, and forecast a smaller-than-expected drop in first-quarter revenue, sending its shares up 11 percent in extended trading. US President Donald Trump's sweeping tariffs on imports from key trading partners could add around $1 billion to Nike's costs, company executives said on a post-earnings call after the sportswear giant topped estimates for fourth-quarter results. China, subject to the biggest tariff increases imposed by Trump, accounts for about 16 percent of the shoes Nike imports into the United States, chief financial officer Matthew Friend said. But the company aims to cut the figure to a 'high single-digit percentage range' by the end of May 2026 as it shifts production to other countries. Consumer goods is one of the most affected areas by the tariff dispute between the world's two largest economies, but Nike's executives said they were focused on cutting the financial pain. Nike will 'evaluate' corporate cost reductions to deal with the tariff impact, Friend said. The company has already announced price increases for some products in the U.S. 'The tariff impact is significant. However, I expect others in the sportswear industry will also raise prices, so Nike may not lose much share in the US,' said David Swartz, analyst at Morningstar Research. Running Finds Its Footing Chief executive Elliott Hill's strategy to focus product innovation and marketing around sports is beginning to show some fruit with the running category returning to growth in the fourth quarter after several quarters of weakness. Having lost share in the fast-growing running market, Nike has invested heavily in running shoes such as Pegasus and Vomero, while scaling back production of sneakers such as the Air Force 1. 'Running has performed especially strongly for Nike,' said Citi analyst Monique Pollard, adding that new running shoes and sportswear products are expected to offset the declines in Nike's classic sneaker franchises at wholesale partner stores. Marketing spending was up 15 percent year-on-year in the quarter. On Thursday, Nike hosted an event in which its sponsored athlete Faith Kipyegon attempted to run a mile in under four minutes. Paced by other star athletes in the glitzy and live-streamed from a Paris stadium, Kipyegon fell short of the goal but set a new unofficial record. Nike forecast first-quarter revenue to fall in the mid-single digits, slightly better than analysts' expectations of a 7.3 percent drop, according to data compiled by LSEG. Its fourth-quarter sales fell 12 percent to $11.10 billion, but still beat estimates of a 14.9 percent drop to $10.72 billion. China continued to be a pain point, with executives saying a turnaround in the country will take time as Nike contends with tougher economic conditions and competition. The company's inventory was flat year-over-year at $7.5 billion as of May 31. By Helen Reid and Juveria Tabassum. Reporting by Juveria Tabassum in Bengaluru; Editing by Shinjini Ganguli and Alan Barona. Learn more: Is Nike Finally Winning With Women? With the bold marketing like the 'So Win' campaign, a revamped leadership team under new brand president Amy Montagne and star power from A'ja Wilson, Nike's long-promised women's push is starting to stick.
Mint
16 hours ago
- Automotive
- Mint
Xiaomi YU7 SUV, company's second EV, receives 240000 orders in 18 hours; challenges Tesla in China
Xiaomi's latest electric SUV, the YU7, has triggered a buying frenzy in China, racking up around 240,000 orders within just 18 hours of launch, a performance that sent the company's shares soaring to a record high on Friday. The orders, considered firm by Xiaomi, include both large deposits for vehicles ready for delivery and smaller sums for those yet to be produced. The overwhelming demand underlines the smartphone giant's growing foothold in the electric vehicle (EV) sector, as it intensifies competition with established players like Tesla. This marks Xiaomi's second foray into the EV market, following the successful debut of its SU7 sedan in March last year. Priced from 253,500 yuan (approximately $35360), the YU7 undercuts Tesla's Model Y by nearly four per cent, further fuelling speculation that the US automaker may need to respond with price cuts or new incentives to maintain its market share. 'Tesla may be forced to reduce prices further or consider bundling its Full Self-Driving (FSD) system for free to stay competitive,' said Citi analysts in a client note. The YU7's specifications are also attracting attention. Its standard model includes a substantial 96.3 kWh battery pack offering a claimed range of up to 835 kilometres (519 miles) on a single charge, significantly more than the 719-kilometre range of the redesigned Tesla Model Y, which has a smaller 78.4 kWh battery. The YU7 also offers rapid charging capabilities and a number of consumer-focused features, including under-seat storage drawers and free driver-assistance software, a feature that costs an additional 64,000 yuan on Tesla's models. While acknowledging Tesla's superiority in autonomous driving, Xiaomi CEO Lei Jun argued that the YU7 surpasses the Model Y in several other areas. 'We are offering more value where it counts for Chinese drivers,' he said at the launch event. The company claimed 289,000 YU7 orders were logged within the first hour of sales on Thursday night, over three times the figure achieved by the SU7 at its debut. However, Lei cautioned that some of these may come from scalpers attempting to resell their early positions in the queue. Hundreds of listings offering order slots were spotted on the secondhand trading platform Xianyu. In response, Xiaomi has implemented a two-vehicle purchase cap per customer to deter scalping and ensure fairer distribution. (With inputs from Reuters)
