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Citizens Financial Gains 22.2% in a Year: How to Play the Stock Now?
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Key Takeaways
Citizens Financial shares gained 22.2% in a year, outperforming the industry's 18.8% growth.
CFG expects 2026 NII growth above its initial 10-12% target, with fee income near its 6-8% range.
CFG's Private Bank posted ROE above 25%, with $17.8 billion in deposits and $9.7 billion in loans.
Shares of Citizens Financial Group, Inc. (CFG - Free Report) have gained 22.2% in the past year, outperforming the industry’s 18.8% growth.
If we compare the company’s price performance with its peers, Valley National Bancorp (VLY - Free Report) and Bank OZK (OZK - Free Report) , it appears that the CFG stock has underperformed Valley National, while it has outperformed Bank OZK in the past year. VLY stock has gained 23.5%, while the OZK stock has lost 8.4% in a year.
Price Performance
Image Source: Zacks Investment Research
With the stock showing gains over the past year, the question is whether CFG has further upside potential. Let us take a closer look at its fundamentals and growth prospects to assess the outlook.
Key Factors Driving Citizens Financial’s Growth
Organic Growth Momentum: The company has maintained a steady revenue growth trend, with total revenues increasing at a compound annual growth rate (CAGR) of 3.6% during 2020-2025. The increase was driven primarily by net interest income (NII), which expanded at a 5% CAGR, while non-interest income declined at a CAGR of nearly 1% during the same period. However, the revenue mix improved in the first half of 2026, as both NII and non-interest income increased year over year.
Looking ahead, higher interest-earning assets and a favorable funding mix are expected to support NII growth, despite the Federal Reserve’s September 2026 rate hike and expectations for further tightening this year. On the fee income side, strength across capital markets, wealth management and other businesses is likely to support non-interest income. At the Barclays 24th Annual Global Financial Services Conference, management said that 2026 NII growth is expected to exceed its initial 10-12% target, while fee income is tracking toward the upper end of its 6-8% range. Together, these factors should support Citizens Financial’s revenue growth in the near term.
The Zacks Consensus Estimate for CFG’s 2026 and 2027 revenues is pegged at $9.2 billion and $9.9 billion, which indicates year-over-year growth of 11.1% and 9.1%, respectively.
Revenue Estimates
Image Source: Zacks Investment Research
Balance Sheet Expansion: Citizens Financial has maintained a solid loan and deposit franchise, with loans and leases and deposits expanding at a CAGR of 3.1% and 4.5%, respectively, during 2020-2025, with the momentum continuing in the first half of 2026. Its granular deposit base, which accounted for more than 90% of funding in the second quarter, provides stable funding for lending activities. Meanwhile, its relationship-based approach and investments in wealth management and capital markets are supporting deposit and fee growth.
The strength of CFG’s franchise and improving profitability are expected to support further balance-sheet expansion. In September 2026, Fitch Ratings upgraded CFG’s Long-Term Issuer Default Rating to “A-” from “BBB+,” citing improved earnings power, a diversified business model and a strong deposit franchise. Fitch noted that the bank benefited from relatively favorable deposit remixing during the 2022-2024 tightening cycle and reported a loan-to-deposit ratio of 80.2% as of the second quarter of 2026, above its peers’ average.
Going forward, relationship-based lending and attractive risk-adjusted returns are expected to support loan growth, with management projecting average loans to increase 3-5% from $142.7 billion in 2025. Meanwhile, lower-risk assets and reduced non-core exposures are likely to improve the balance-sheet mix and support funding stability.
Private Bank Expansion to Drive Growth: The company is advancing its long-term strategy through continued expansion of its Private Bank, launched in October 2023, along with growth in key markets and enhanced capabilities for high-net-worth clients. The Private Bank continued to make strong progress in the second quarter of 2026, delivering return on equity (ROE) above 25% and reaching $17.8 billion in average deposits and $9.7 billion in loans. The business also expanded to 10 private banking offices, with six additional locations planned for 2027.
Citizens Private Bank’s Loan and Deposit Growth
Image Source: Citizens Financial Group
Looking ahead, continued customer growth and expansion across the New York Metro, Florida and California markets are expected to support the Private Bank’s growth. The company is also investing in its payments platform and commercial middle-market coverage, along with expanding its private banking office network. These initiatives are likely to drive further growth in deposits, loans and client relationships while supporting the company’s broader wealth management strategy.
Strategic Branch Expansion to Support Growth: CFG is optimizing its branch network under the Network Evolution and “Xperience” Transformation initiative to accelerate consumer deposit and revenue growth. The company plans to reshape its network toward higher-growth markets while keeping the overall branch count relatively stable through 2035. The strategy includes exiting approximately 100-120 in-store branches, adding 50-60 nearby traditional branches, expanding specialized sales capabilities in Wealth and Small Business and selectively opening de novo branches in attractive markets.
These initiatives are expected to deepen customer relationships, boost deposit growth and support medium- to long-term growth, while helping CFG achieve its target return on tangible common equity of 16-18% by the end of 2027.
Decent Liquidity Supports Capital Distribution: CFG maintains a decent liquidity position. As of June 30, 2026, the company had $13.9 billion in available liquidity against $15.2 billion in long-term debt and $1.2 billion in short-term debt.
Given this strength, Citizens Financial continues to return capital through share repurchases. In June 2025, the board approved an increase in its common share repurchase program to $1.5 billion. As of June 30, 2026, $775 million worth of shares remained available under the program.
Apart from repurchases, the company has been consistently paying dividends. In October 2025, Citizens Financial raised its dividend by 9.5% to 46 cents per share. It has increased its dividend three times over the past five years while maintaining a payout ratio of 40%. Further, its dividend yield of 2.8% compares favorably with the industry’s 2.5%. Notably, the dividend yields of CFG’s peers, Bank OZK and Valley National, are 4.1% and 3.4%, respectively.
Dividend Yield
Image Source: Zacks Investment Research
What’s Hurting Citizens Financial’ Growth?
Rising Expense Base: Rising expenses remain a key headwind for Citizens Financial. Its non-interest expenses increased at a CAGR of 5.9% from 2020 to 2025 and rose 5.3% year over year in the first half of 2026, driven by higher staffing costs in Private Bank and Capital Markets and expenses related to Reimagine the Bank. Management expects third-quarter 2026 expenses to remain stable or increase slightly. Despite cost-control efforts, expenses are likely to remain elevated due to private banking office expansion, franchise investments and technology spending.
Declining Mortgage Revenue: Weakness in CFG’s mortgage banking business is another concern. Relatively high mortgage rates have weighed on mortgage origination volumes and refinancing activity. Mortgage banking fees declined at a CAGR of 23.9% from 2020 to 2025, with the downward trend continuing in the first half of 2026. Further, elevated mortgage rates and volatility in the mortgage market are likely to pressure the company’s mortgage banking performance in the near term.
Analyzing CFG’s Earnings Estimates & Valuation
The Zacks Consensus Estimate for Citizens Financial’s 2026 earnings is pegged at $5.30 per share, indicating year-over-year growth of 37.3%. The estimate for 2027 earnings is $6.53 per share, suggesting an increase of 23.3% year over year.
Over the past 30 days, the 2026 earnings estimate has remained unchanged, while the 2027 estimate has been revised higher.
Estimate Revision Trend
Image Source: Zacks Investment Research
In terms of valuation, CFG stock appears expensive relative to the industry. The company is currently trading at a 12-month trailing price-to-earnings P/E ratio of 10.6X, higher than the industry’s 9.8X. Meanwhile, Bank OZK holds a P/E ratio of 7.8X, while Valley National’s P/E ratio stands at 8.9X.
Price-to-Earnings F12 M
Image Source: Zacks Investment Research
How to Approach CFG Stock Now
Supported by steady revenue growth, balance-sheet expansion and continued investment in its Private Bank, Citizens Financial is positioned to benefit from growth in loans, deposits and fee-based businesses. Its branch network optimization, improving funding mix and capital distribution also provide support to the company’s growth outlook.
However, rising expenses and weakness in mortgage banking remain near-term concerns. CFG’s relatively high valuation compared with the industry warrants caution, despite upward revisions to the 2027 earnings estimate.
Given this backdrop, investors should avoid rushing into CFG stock at current levels. Instead, they should keep the stock on their radar and wait for a more attractive entry point. Existing shareholders can continue to monitor the stock, as its strong franchise, capital returns and long-term growth initiatives remain key factors supporting its outlook.
View the Zacks #1 Rank List
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Citizens Financial Gains 22.2% in a Year: How to Play the Stock Now?
Key Takeaways
Shares of Citizens Financial Group, Inc. (CFG - Free Report) have gained 22.2% in the past year, outperforming the industry’s 18.8% growth.
If we compare the company’s price performance with its peers, Valley National Bancorp (VLY - Free Report) and Bank OZK (OZK - Free Report) , it appears that the CFG stock has underperformed Valley National, while it has outperformed Bank OZK in the past year. VLY stock has gained 23.5%, while the OZK stock has lost 8.4% in a year.
Price Performance
Image Source: Zacks Investment Research
With the stock showing gains over the past year, the question is whether CFG has further upside potential. Let us take a closer look at its fundamentals and growth prospects to assess the outlook.
Key Factors Driving Citizens Financial’s Growth
Organic Growth Momentum: The company has maintained a steady revenue growth trend, with total revenues increasing at a compound annual growth rate (CAGR) of 3.6% during 2020-2025. The increase was driven primarily by net interest income (NII), which expanded at a 5% CAGR, while non-interest income declined at a CAGR of nearly 1% during the same period. However, the revenue mix improved in the first half of 2026, as both NII and non-interest income increased year over year.
Looking ahead, higher interest-earning assets and a favorable funding mix are expected to support NII growth, despite the Federal Reserve’s September 2026 rate hike and expectations for further tightening this year. On the fee income side, strength across capital markets, wealth management and other businesses is likely to support non-interest income. At the Barclays 24th Annual Global Financial Services Conference, management said that 2026 NII growth is expected to exceed its initial 10-12% target, while fee income is tracking toward the upper end of its 6-8% range. Together, these factors should support Citizens Financial’s revenue growth in the near term.
The Zacks Consensus Estimate for CFG’s 2026 and 2027 revenues is pegged at $9.2 billion and $9.9 billion, which indicates year-over-year growth of 11.1% and 9.1%, respectively.
Revenue Estimates
Image Source: Zacks Investment Research
Balance Sheet Expansion: Citizens Financial has maintained a solid loan and deposit franchise, with loans and leases and deposits expanding at a CAGR of 3.1% and 4.5%, respectively, during 2020-2025, with the momentum continuing in the first half of 2026. Its granular deposit base, which accounted for more than 90% of funding in the second quarter, provides stable funding for lending activities. Meanwhile, its relationship-based approach and investments in wealth management and capital markets are supporting deposit and fee growth.
The strength of CFG’s franchise and improving profitability are expected to support further balance-sheet expansion. In September 2026, Fitch Ratings upgraded CFG’s Long-Term Issuer Default Rating to “A-” from “BBB+,” citing improved earnings power, a diversified business model and a strong deposit franchise. Fitch noted that the bank benefited from relatively favorable deposit remixing during the 2022-2024 tightening cycle and reported a loan-to-deposit ratio of 80.2% as of the second quarter of 2026, above its peers’ average.
Going forward, relationship-based lending and attractive risk-adjusted returns are expected to support loan growth, with management projecting average loans to increase 3-5% from $142.7 billion in 2025. Meanwhile, lower-risk assets and reduced non-core exposures are likely to improve the balance-sheet mix and support funding stability.
Private Bank Expansion to Drive Growth: The company is advancing its long-term strategy through continued expansion of its Private Bank, launched in October 2023, along with growth in key markets and enhanced capabilities for high-net-worth clients. The Private Bank continued to make strong progress in the second quarter of 2026, delivering return on equity (ROE) above 25% and reaching $17.8 billion in average deposits and $9.7 billion in loans. The business also expanded to 10 private banking offices, with six additional locations planned for 2027.
Citizens Private Bank’s Loan and Deposit Growth
Image Source: Citizens Financial Group
Looking ahead, continued customer growth and expansion across the New York Metro, Florida and California markets are expected to support the Private Bank’s growth. The company is also investing in its payments platform and commercial middle-market coverage, along with expanding its private banking office network. These initiatives are likely to drive further growth in deposits, loans and client relationships while supporting the company’s broader wealth management strategy.
Strategic Branch Expansion to Support Growth: CFG is optimizing its branch network under the Network Evolution and “Xperience” Transformation initiative to accelerate consumer deposit and revenue growth. The company plans to reshape its network toward higher-growth markets while keeping the overall branch count relatively stable through 2035. The strategy includes exiting approximately 100-120 in-store branches, adding 50-60 nearby traditional branches, expanding specialized sales capabilities in Wealth and Small Business and selectively opening de novo branches in attractive markets.
These initiatives are expected to deepen customer relationships, boost deposit growth and support medium- to long-term growth, while helping CFG achieve its target return on tangible common equity of 16-18% by the end of 2027.
Decent Liquidity Supports Capital Distribution: CFG maintains a decent liquidity position. As of June 30, 2026, the company had $13.9 billion in available liquidity against $15.2 billion in long-term debt and $1.2 billion in short-term debt.
Given this strength, Citizens Financial continues to return capital through share repurchases. In June 2025, the board approved an increase in its common share repurchase program to $1.5 billion. As of June 30, 2026, $775 million worth of shares remained available under the program.
Apart from repurchases, the company has been consistently paying dividends. In October 2025, Citizens Financial raised its dividend by 9.5% to 46 cents per share. It has increased its dividend three times over the past five years while maintaining a payout ratio of 40%. Further, its dividend yield of 2.8% compares favorably with the industry’s 2.5%. Notably, the dividend yields of CFG’s peers, Bank OZK and Valley National, are 4.1% and 3.4%, respectively.
Dividend Yield
Image Source: Zacks Investment Research
What’s Hurting Citizens Financial’ Growth?
Rising Expense Base: Rising expenses remain a key headwind for Citizens Financial. Its non-interest expenses increased at a CAGR of 5.9% from 2020 to 2025 and rose 5.3% year over year in the first half of 2026, driven by higher staffing costs in Private Bank and Capital Markets and expenses related to Reimagine the Bank. Management expects third-quarter 2026 expenses to remain stable or increase slightly. Despite cost-control efforts, expenses are likely to remain elevated due to private banking office expansion, franchise investments and technology spending.
Declining Mortgage Revenue: Weakness in CFG’s mortgage banking business is another concern. Relatively high mortgage rates have weighed on mortgage origination volumes and refinancing activity. Mortgage banking fees declined at a CAGR of 23.9% from 2020 to 2025, with the downward trend continuing in the first half of 2026. Further, elevated mortgage rates and volatility in the mortgage market are likely to pressure the company’s mortgage banking performance in the near term.
Analyzing CFG’s Earnings Estimates & Valuation
The Zacks Consensus Estimate for Citizens Financial’s 2026 earnings is pegged at $5.30 per share, indicating year-over-year growth of 37.3%. The estimate for 2027 earnings is $6.53 per share, suggesting an increase of 23.3% year over year.
Over the past 30 days, the 2026 earnings estimate has remained unchanged, while the 2027 estimate has been revised higher.
Estimate Revision Trend
Image Source: Zacks Investment Research
In terms of valuation, CFG stock appears expensive relative to the industry. The company is currently trading at a 12-month trailing price-to-earnings P/E ratio of 10.6X, higher than the industry’s 9.8X. Meanwhile, Bank OZK holds a P/E ratio of 7.8X, while Valley National’s P/E ratio stands at 8.9X.
Price-to-Earnings F12 M
Image Source: Zacks Investment Research
How to Approach CFG Stock Now
Supported by steady revenue growth, balance-sheet expansion and continued investment in its Private Bank, Citizens Financial is positioned to benefit from growth in loans, deposits and fee-based businesses. Its branch network optimization, improving funding mix and capital distribution also provide support to the company’s growth outlook.
However, rising expenses and weakness in mortgage banking remain near-term concerns. CFG’s relatively high valuation compared with the industry warrants caution, despite upward revisions to the 2027 earnings estimate.
Given this backdrop, investors should avoid rushing into CFG stock at current levels. Instead, they should keep the stock on their radar and wait for a more attractive entry point. Existing shareholders can continue to monitor the stock, as its strong franchise, capital returns and long-term growth initiatives remain key factors supporting its outlook.
The company currently carries a Zacks Rank #3 (Hold). You can seethe complete list of today's Zacks #1 Rank (Strong Buy) stocks here.