7 Most Undervalued Dividend Stocks to Buy According to Hedge Funds

3. Citigroup Inc. (NYSE:C)

Number of Hedge Fund Holders: 101

Forward P/E Ratio as of March 20: 9.47

Citigroup Inc. (NYSE:C) is a global financial institution with operations spanning five key segments: Services, Markets, Banking, U.S. Personal Banking, and Wealth. The company provides a broad range of financial services, including cash management, investment banking, retail banking, and wealth management for high-net-worth individuals.

On March 13, Citigroup Inc. (NYSE:C) announced plans to reduce its dependence on IT contractors, cutting their share from 50% to 20%. At the same time, it aims to expand its full-time IT workforce from 48,000 to 50,000. This initiative is part of the company’s strategy to strengthen internal controls and address regulatory concerns related to data governance.

Citigroup Inc. (NYSE:C) faced significant challenges earlier due to major transaction errors, but analysts view these as temporary setbacks rather than long-term risks to the bank’s overall stability. In fiscal 2024, the company’s net income surged nearly 40% to $12.7 billion, surpassing its revenue target. This growth was driven by strong performances across its Services, Wealth, and US Personal Banking divisions, as well as greater operational efficiency from cost-cutting measures and a large-scale restructuring. Annual revenue increased 3% year-over-year to $81.1 billion.

Citigroup Inc. (NYSE:C) has maintained a strong track record of shareholder returns, distributing $6.7 billion in dividends and stock repurchases during FY24. With an uninterrupted 34-year history of dividend payments, Citigroup continues to stand out as one of the top dividend stocks. It currently offers a quarterly dividend of $0.56 per share for a dividend yield of 3.12%, as of March 20.