Citigroup (C) Improved ROTE Compared to Peers in Q3

Investment management company First Pacific Advisors recently released its “The FPA Crescent Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the third quarter, the fund gained 5.54% and 15.32% in the trailing twelve months. The fund’s top five performers contributed 6. 65% to its trailing twelve-month return while its bottom five detracted 2.58%. In addition, you can check the top 5 holdings of the fund to know its best picks in 2025.

In its third-quarter 2025 investor letter, The FPA Crescent Fund highlighted stocks such as Citigroup Inc. (NYSE:C). Citigroup Inc. (NYSE:C) is a diversified financial services holding company. The one-month return of Citigroup Inc. (NYSE:C) was 6.02%, and its shares gained 49.30% of their value over the last 52 weeks. On November 5, 2025, Citigroup Inc. (NYSE:C) stock closed at $101.69 per share, with a market capitalization of $181.954 billion.

The FPA Crescent Fund stated the following regarding Citigroup Inc. (NYSE:C) in its third quarter 2025 investor letter:

"Citigroup Inc. (NYSE:C) has improved its return on tangible equity (ROTE) compared to industry peers. In addition, regulatory changes in the US have increased the normal level of ROTE for US-based banks. The combination of a low starting valuation, demonstrated operating improvement, and an improved regulatory environment have resulted in strong share-price performance over the past twelve months."

Citigroup Inc. (NYSE:C) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 102 hedge fund portfolios held Citigroup Inc. (NYSE:C) at the end of the second quarter, up from 96 in the previous quarter.  While we acknowledge the potential of Citigroup Inc. (NYSE:C) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Citigroup Inc. (NYSE:C) and shared the list of most undervalued large cap stocks to buy. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.