Despite performing beyond analysts' expectations and reporting fourth-quarter revenue gains, prominent financial institution Citigroup Inc. stock slumped 6.4 percent on Friday in New York, with the company's shares dropping to $42.47, according to Bloomberg Business.
Chris Kotowski, an analyst at Oppenheimer & Co., believes that the slump was due to the fact that the bank's report included a lot of special, one-time items that might have turned off a number of investors. The analyst further stated that overall, the bank's the revenue was "soft."
Citigroup's earnings reached $1.02 a share, or $3.3. billion, during the fourth quarter of 2015. The earnings were far beyond the bank's revenue in the same quarter of the previous year, when the bank earned $0.06 a share, or $344 million, reports The Financial Times.
Michael Corbat, CEO of Citigroup, has been on the move to restructure the company, disposing of unwanted businesses and making the company more profitable while making its earnings far more predictable. With regards to the company's performance in 2015, the CEO is optimistic.
"Overall, we had strong performance during 2015. The $17.1 billion we generated in net income was the highest since 2006 when our company was very different in terms of headcount, footprint, mix of businesses and assets," he said, according to CNBC News.
Shannon Stemm, an analyst at Edward Jones & Co. in St. Louis, stated that despite the revenue reports, the actual growth of the company's primary business unit has left much to be desired.
"It would certainly be a bigger catalyst for the stock if you saw a surprise out of the various units in Citicorp, the company's primary business unit, rather than in sales of unwanted assets. When you look into Citicorp, that's where results get a little more mixed. Revenue growth has been sluggish," the analyst said.
