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Shares of Citigroup (NYSE:C) have dipped to the mid-$2 level moving into earnings season and, as I've stated before, I think that bad news is already priced into the stock.

I don't expect that Citi will significantly surpass expectations when they release second quarter earnings, but I do like the stock as a BUY while it is trading below three dollars.

Short term traders with no stomach for patience should stand clear of C, but investors with a 2-4 year time horizon could be getting a bargain basement price right now.

That being said, if Citi does beat the street, a run up to over four dollars is possible, but the current economic climate indicates that it is not probable.

Contrary to popular belief, the banks are lending money; they're just not handing it out 'for free' as they were before the economic collapse. Granted, signs of recovery are not everywhere, but in various areas around the country used cars are flying off the lots and houses are being sold, that means the banks are lending.

The stock market is reacting to the latest news on the street, which is changing daily. One day housing numbers are good and the market responds positively while the next day unemployment rises so the market drops. This is the classic 'buy the dips' climate because you don't want to be left chasing the run if you haven't built a position before the run starts.

The big boys can afford to do that, but the little guy needs to be setting up for the recovery now.

Buying C for below three dollars should be a part of that plan.


Editor's Note 7/13: Disclosure- Author does, in fact, have a long position in the stock

Source: Citigroup: Bargain Basement Price for Long Term Investors