Citizens Financial Group: Value or Value Trap?

A value stock is only worth buying if it's, well, a good value. A beaten-down share price alone doesn't make it a bargain -- it has to be underpriced because of temporary factors but really worth considerably more. Over time, once those temporary factors (like, say, a pandemic) get sorted out, the market will recognize its intrinsic value, rewarding investors who bought when it was down.

That's a value stock. A value trap is a stock that may look like a value based on its price, but is not because there are underlying issues or longer-term concerns that indicate the stock won't bounce back and will likely stay flat or lose value.

With that in mind, let's take a look at Citizens Financial Group (NYSE: CFG), the parent company of Citizens Bank, the 16th-largest bank in the country, with $179.9 billion in assets as of June 30. Is it a value or value trap?

Continue reading

Source Fool.com