12:46 PM EST, 11/05/2024 (MT Newswires) -- Citigroup ( C ) has "potential catalysts" extending beyond US election results, UBS Securities said in a note Tuesday, noting that a Trump win would be beneficial for the bank.

UBS believes that the strategies of either the incoming President through tariffs or government expenditure might lead to inflation. In such a scenario, the firm believes that the risk, both worldwide and within the country, might lean more towards fewer cuts than what the current market expectations, as indicated by forward curves globally, suggest.

Consequently, Citigroup's ( C ) designation as "liability sensitive" suggests that the market is inaccurately valuing it as a beneficiary from fewer cuts, according to the note.

"As investors grapple with the market consequences of various election scenarios, one thing seems to be market consensus: [Citigroup ( C )] should be a beneficiary of a Trump victory, especially given its lagged performance," UBS said in the note.

UBS sees steady revenue growth and operational improvements as key drivers for Citi. The bank's ability to meet its 4% to 5% revenue CAGR target in 2025 would be "positive" for its shares, UBS said.

"A continuation of "good" volatility in trading and further rebound in capital markets activity -- would clearly materially benefit [Citigroup ( C )]," according to the note.

Additionally, UBS projects "stable-to-higher net" interest income in 2025, estimating $54.1 billion, even amid potential rate declines globally.

UBS maintained a neutral rating on Citi's stock with a $71 price target.

Shares of Citigroup ( C ) were up 1.5% in recent trading.

Price: 63.28, Change: +0.93, Percent Change: +1.49