Here's Why Citigroup (C) Performed Well in Q3

Hotchkis & Wiley, an investment management company, released its “Hotchkis & Wiley Large Cap Disciplined Value Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The S&P 500 Index recorded a return of +8.1% in the third quarter of 2025, closing the period near its all-time highs. Technology and communication services drove the broad large-cap market while small caps outperformed their large counterparts in the quarter. The fund outperformed the Russell 1000 Value Index in the quarter, returning 6.41% vs 5.33% for the index. Please review the fund’s top 5 holdings to gain insight into their key selections for 2025.

In its third-quarter 2025 investor letter, Hotchkis & Wiley Large Cap Disciplined Value 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 7.37%, and its shares gained 46.95% of their value over the last 52 weeks. On November 6, 2025, Citigroup Inc. (NYSE:C) stock closed at $100.85 per share, with a market capitalization of $180.451 billion.

Hotchkis & Wiley Large Cap Disciplined Value Fund stated the following regarding Citigroup Inc. (NYSE:C) in its third quarter 2025 investor letter:

"Citigroup Inc. (NYSE:C) is one of the largest US banks by total assets. Investment in its IT, compliance and risk capabilities have pressured margins and returns over recent years, obscuring the banks strong core franchise. With these investments now largely complete we expect Citi’s expense to decline and its margins and returns to be more consistent with peers. Citigroup performed well in the quarter after reporting strong Q2 earnings. We continue to believe Citigroup is undervalued on our normal expectations and would still be attractive even if they do not fully achieve their expense and margin goals."

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 FPA Crescent Fund's views on the company. 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.