Citizens Financial Group, Inc. (CFG - Free Report) is on track to ramp up its profitability in 2017 with fresh “Tapping Our Potential (TOP) program” objectives. Also, it is moving ahead with a new set of initiatives for 2018. Further, its strong capital position, reflected by inorganic growth strategies and steady capital deployment activities, should support growth.
Citizens Financial’s shares have gained 2.1% year to date, versus the industry’s decline of 4.2%.
Also, the company’s Zacks Consensus Estimate for current-year earnings have remained stable over the last 30 days. Currently, the stock carries a Zacks Rank #2 (Buy).
Why the Stock is Worth Buying
Impressive Initiatives: Citizens Financial’s TOP program focuses on improving its financials and revamping its profitability. The company expects to achieve a pre-tax benefit of $110 million, including tax efficiency benefit of $20 million by the end of 2017.
Inorganic Growth Strategies: The company recently acquired Western Reserve Partners LLC, which would strengthen its ability to serve commercial clients by accelerating the build out of its M&A and financial advisory capabilities.
Earnings per Share Strength: Over the past three to five years, Citizens Financial witnessed earnings per share (EPS) growth of 19.7% compared with 12.5% for the industry. Notably, the company also recorded an average positive earnings surprise of 9.07%, over the trailing four quarters.
Also, the company’s long-term (three to five years) estimated EPS growth rate of 31.3%, compared with 8.4% for the industry, promises rewards for investors over the long run.
Efficient Capital Deployment: Apart from an ongoing share repurchase program, the company displayed its strong balance sheet position by increasing the quarterly common stock dividend by 29% from the thirdquarter.
Stock Looks Undervalued: Citizens Financial’s current price-to-book and price-earnings (F1) ratios are lower than the respective industry averages. Based on these ratios, the stock looks undervalued. Also, the company has a Value Score of B.
Other Stocks to Consider
Some of the other financial stocks worth considering include M&T Bank Corporation (MTB - Free Report) , HopFed Bancorp, Inc. (HFBC - Free Report) and PNC Financial Services Group, Inc. (PNC - Free Report) . All these stocks carry a Zacks Rank #2.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
M&T Bank’s current-year earnings estimate have been revised slightly upward over the past 60 days.
HopFed's Zacks Consensus Estimate for earnings moved upward by 16.7% over the past 60 days, for the current year.
PNC Financial’s current-year earnings estimates have been revised nearly 1% upward, over the past 60 days.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>