Financial Contrast: First Commonwealth Financial (NYSE:FCF) and Citigroup (NYSE:C)

First Commonwealth Financial (NYSE:FCF) and Citigroup (NYSE:C) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, earnings, valuation, institutional ownership, analyst recommendations, dividends and risk.

Profitability

This table compares First Commonwealth Financial and Citigroup’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Commonwealth Financial	20.38%	10.36%	1.22%
Citigroup	7.43%	6.62%	0.53%

Analyst Ratings

This is a breakdown of recent ratings for First Commonwealth Financial and Citigroup, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Commonwealth Financial	0	3	3	0	2.50
Citigroup	0	3	11	0	2.79

First Commonwealth Financial presently has a consensus price target of $19.58, suggesting a potential upside of 34.45%. Citigroup has a consensus price target of $84.61, suggesting a potential upside of 33.81%. Given First Commonwealth Financial’s higher probable upside, equities analysts plainly believe First Commonwealth Financial is more favorable than Citigroup.

Volatility & Risk

First Commonwealth Financial has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500. Comparatively, Citigroup has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500.

Institutional and Insider Ownership

72.6% of First Commonwealth Financial shares are held by institutional investors. Comparatively, 71.7% of Citigroup shares are held by institutional investors. 2.2% of First Commonwealth Financial shares are held by insiders. Comparatively, 0.1% of Citigroup shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares First Commonwealth Financial and Citigroup”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Commonwealth Financial	$478.12 million	3.10	$142.57 million	$1.39	10.48
Citigroup	$81.60 billion	1.46	$12.68 billion	$6.33	9.99

Citigroup has higher revenue and earnings than First Commonwealth Financial. Citigroup is trading at a lower price-to-earnings ratio than First Commonwealth Financial, indicating that it is currently the more affordable of the two stocks.

Dividends

First Commonwealth Financial pays an annual dividend of $0.52 per share and has a dividend yield of 3.6%. Citigroup pays an annual dividend of $2.24 per share and has a dividend yield of 3.5%. First Commonwealth Financial pays out 37.4% of its earnings in the form of a dividend. Citigroup pays out 35.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

About First Commonwealth Financial

First Commonwealth Financial Corporation, a financial holding company, provides various consumer and commercial banking services in the United States. Its consumer services include personal checking accounts, interest-earning checking accounts, savings and health savings accounts, insured money market accounts, debit cards, investment certificates, fixed and variable rate certificates of deposit, mortgage loans, secured and unsecured installment loans, construction and real estate loans, safe deposit facilities, credit cards, credit lines with overdraft checking protection, IRA accounts, and automated teller machine (atm) services, as well as internet, mobile, and telephone banking services. The company's commercial banking services comprise commercial lending, business checking accounts, online account management services, payroll direct deposits, commercial cash management services, and repurchase agreements, as well as ACH origination services. In addition, it offers various trust and asset management services; auto, home, and business insurance, as well as term life insurance; and annuities, mutual funds, and stock and bond brokerage services through a broker-dealer and insurance brokers. The company was founded in 1934 and is headquartered in Indiana, Pennsylvania.

About Citigroup

Citigroup Inc., a diversified financial service holding company, provides various financial product and services to consumers, corporations, governments, and institutions worldwide. It operates through five segments: Services, Markets, Banking, U.S. Personal Banking, and Wealth. The Services segment includes Treasury and Trade Solutions, which provides cash management, trade, and working capital solutions to multinational corporations, financial institutions, and public sector organizations; and Securities Services, such as cross-border support for clients, local market expertise, post-trade technologies, data solutions, and various securities services solutions. The Markets segment offers sales and trading services for equities, foreign exchange, rates, spread products, and commodities to corporate, institutional, and public sector clients; and market-making services, including asset classes, risk management solutions, financing, prime brokerage, research, securities clearing, and settlement. The banking segment includes investment banking; advisory services related to mergers and acquisitions, divestitures, restructurings, and corporate defense activities; and corporate lending, which includes corporate and commercial banking. The U.S. Personal Banking segment provides co-branded cards and retail banking services. The Wealth segment provides financial services to high-net-worth clients through banking, lending, mortgages, investment, custody, and trust product offerings; and to professional industries, including law firms, consulting groups, accounting, and asset management. The company was founded in 1812 and is headquartered in New York, New York.