10 Best Financial Stocks To Buy According to Hedge Funds

8. Citigroup Inc. (NYSE:C)

Number of Hedge Fund Holders: 88

One of the Best Financial Stocks, Citigroup Inc. (NYSE:C) is a multinational financial services firm with operations in over 100 countries and jurisdictions. The activities of the company are divided into five main areas: wealth management, banking, markets, services, and US personal banking. The bank’s main offerings are credit card services in the US, investment banking and trading, and cross-border banking requirements for multinational companies.

Citigroup Inc. (NYSE:C) has both a domestic retail banking division and a franchise for international commercial banking. The bank’s commercial operations—services, markets, and banking segments (formerly known as Institutional Client Group, or ICG)—include large trading, investment banking, international corporate banking, and custody operations. Given its global reach, the firm’s commercial banking division is its most distinctive business. This global reach will support its continued status as a preferred bank for multinational corporations. Although there are certain benefits to having a global presence, maintaining it is costly and difficult, and the bank’s markets department yields low profits. Consequently, the commercial banking industry has seen a range of returns.

Citigroup Inc. (NYSE:C) is undergoing a strategic repositioning, which includes substantial measures like selling off its consumer business in Mexico and reinvesting in commercial banking and wealth. The business may finally emerge as a structurally improved franchise.

In Q3 of 2024, the company saw positive revenue growth, with overall revenues increasing by 3% excluding divestitures, as each key segment achieved growth and improved operating leverage. Significant fee growth and higher loan and deposit volumes propelled the Services segment’s 8% revenue gain, which set a new quarterly record. Wealth management also made significant strides, as seen by a 24% growth in client investment assets and a 9% increase in revenues. Meanwhile, adviser productivity at Citigold North America rose by more than 50%. YoY. Investment-grade debt issuance and solid advisory performance drove a 44% YoY increase in investment banking fees. The company also returned $2.1 billion in capital, including $1 billion in share repurchases, while maintaining a strong CET1 capital ratio of 13.7%.

Warren Buffett’s Berkshire Hathaway was the largest stakeholder in the company among the funds in Insider Monkey’s database at the end of Q3 2024. It owns 55.24 million shares worth $3.46 billion as of Q3.