Citigroup upgraded to Overweight at Piper on turnaround story

Piper Sandler upgraded Citigroup (NYSE:C) to Overweight from Neutral as bank stocks' recent pullback provides a more attractive entry point for Citi shares. C stock gained 1.3% in Wednesday premarket trading.

With New York Community Bancorp's (NYCB) surprise Q4 loss and the Federal Reserve now expected to start cutting rates later than the market had earlier anticipated, bank stocks have been sliding. Year-to-date,

Piper analyst R. Scott Siefers, though, sees the narrative for Citi (C) still intact. "Though the turnaround will likely have some bumps along the way, we like CEO Jane Fraser's more targeted view of the company," he wrote in a note to clients. "We believe cost flexibility should support the overall outlook (which we consider important given an ambitious revenue forecast)."

"To be sure, the company has plenty of its own questions, and it will not be a straight line to success. But as we survey the group’s pain from the past couple weeks and consider C’s risk/reward specifically, we are giving it a fresh & more constructive look," he added.

He raised his price target on the stock to $63 from $56.

Siefers also remains constructive on JP Morgan Chase (JPM) in the universal bank sector and Fifth Third Bancorp (FITB) and KeyCorp (KEY) in the regional space.