What To Expect From Citigroup Stock After 6% Drop?

C: Citigroup logo

Citigroup’s Stock (NYSE: C) has missed the consensus estimates in its recently released fourth-quarter results. It reported a 10% y-o-y drop in its revenues mainly due to the lower interest rate environment and a decline in card volumes. The stock has moved -6% in a week (5 trading days) to $59 now. But will the company’s stock resume its upward trajectory over the coming weeks, or is a fall in the stock imminent?

According to the Trefis Machine Learning Engine, which identifies trends in a company’s stock price using 20 years of historical stock data, returns for Citigroup stock average around 0.8% in the next one-month (21 trading days) period after experiencing a -6% movement in a week (5 trading days). Notably, though, the stock return is likely to remain marginally below (-0.2%) the S&P500 returns over the next month (21 trading days).

But how would these numbers change if you are interested in holding Citigroup’s stock for a shorter or a longer time period? You can test the answer and many other combinations on the Trefis Machine Learning Engine to test Citigroup’s stock chances of a rise after a fall. You can test the chance of recovery over different time intervals of a quarter, month, or even just 1 day!

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MACHINE LEARNING ENGINE – try it yourself:

IF C stock moved by -5% over 5 trading days, THEN over the next 21 trading days, Citigroup stock moves an average of 0.5 percent, which implies an excess return of -0.6 percent compared to the S&P500.

More importantly, there is a 51.3% probability of a positive return over the next 21 trading days and a 41.3% probability of a positive excess return after a -5% change over 5 trading days.

Some Fun Scenarios, FAQs & Making Sense of Citigroup Inc Stock Movements:

Question 1: Is the average return for Citigroup Inc stock higher after a drop?


Consider two situations,

Case 1: Citigroup Inc stock drops by -5% or more in a week

Case 2: Citigroup Inc stock rises by 5% or more in a week

Is the average return for Citigroup Inc stock higher over the subsequent month after Case 1 or Case 2?

C stock fares better after Case 2, with an average return of 3.1% over the next month (21 trading days) under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an average return of 3.5% for Case 2.

In comparison, the S&P 500 has an average return of 3.1% over the next 21 trading days under Case 1, and an average return of just 0.5% for Case 2 as detailed in our dashboard that details the average return for the S&P 500 after a fall or rise.

Try the Trefis machine learning engine above to see for yourself how Citigroup Inc stock is likely to behave after any specific gain or loss over a period.

Question 2: Does patience pay?


If you buy and hold Citigroup Inc stock, the expectation is over time the near term fluctuations will cancel out, and the long-term positive trend will favor you – at least if the company is otherwise strong.

Overall, according to data and Trefis machine learning engine’s calculations, patience absolutely pays for most stocks!

For C stock, the returns over the next N days after a -5% change over the last 5 trading days is detailed in the table below, along with the returns for the S&P500:

You can try the engine to see what this table looks like for Citigroup Inc after a larger loss over the last week, month, or quarter.

Question 3: What about the average return after a rise if you wait for a while?


The average return after a rise is understandably lower than a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks – although C stock appears to be an exception to this general observation.

C’s returns over the next N days after a 5% change over the last 5 trading days is detailed in the table below, along with the returns for the S&P500:

It’s pretty powerful to test the trend for yourself for Citigroup Inc stock by changing the inputs in the charts above.

What if you’re looking for a more balanced portfolio instead? Here’s a high quality portfolio to beat the market, with over 100% return since 2016, versus 55% for the S&P 500. Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk, it has outperformed the broader market year after year, consistently.


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