10 Best Financial Stocks To Buy According to Hedge Funds

03. Citigroup Inc. (NYSE:C)

Number of Hedge Fund Holders: 94

Citigroup Inc. (NYSE:C) CEO Jane Fraser stated on June 18 that the bank has moved away from its expansive model of the 1990s. “We are no longer the financial supermarket of the past,” Fraser said at an event in New York City. “Instead, our vision is sharply focused”. Citigroup Inc. (NYSE:C) is scaling back operations, divesting businesses, and reducing the workforce to boost stock performance and streamline operations. CFO Mark Mason labeled 2024 as an “inflection year,” aiming to increase full-year revenue by at least $6 billion by 2026 while cutting expenses by at least $500 million. On June 20, Keefe, Bruyette & Woods analyst David Konrad reiterated a “Market Perform” rating for Citigroup Inc. (NYSE:C) and increased the price target from $66 to $69.

In the first quarter of 2024, the number of hedge funds with stakes in Citigroup Inc. (NYSE:C) increased to 94 from 87 in the previous quarter, according to Insider Monkey’s database. The combined value of these stakes is approximately $10.64 billion. Warren Buffett’s Berkshire Hathaway emerged as the largest stakeholder among these hedge funds during this period.

Silver Beech Capital stated the following regarding Citigroup Inc. (NYSE:C) in its first quarter 2024 investor letter:

“Since the beginning of 2023, Citigroup Inc. (NYSE:C) has been one of the Fund’s largest holdings. In our Q3 2023 investor letter, we laid out our core investment thesis for Citi: although the bank was an underperformer (weak returns on equity), Citi was (1) less risky than it had ever been and (2) cheaper than it had ever been. The Fund’s investment thesis for Citi featured in a November 2023 Euromoney article Citi 2.0: If she builds it, will they come?

The market narrative has started to converge on our investment thesis. During the first quarter, Citi was the best-performing bank stock in the S&P 500 index. However, improvements in Citi’s operating performance have come more slowly than its share price gains. Due to this converging market perception with our own thesis, the Fund exited its position in Citi. The Fund’s stake in Citi generated a 34% gross IRR over our 14-month investment period.”