When Will Citi Get it Right?

Citigroup (C) has been testing investor patience for a number of years and Mr. Prince is definitely running out of time. But how long will this last? How long will investors have to wait until the stock price reflects the true value of this company? Naturally, we always have to keep in mind that, as Keynes said: “Markets can remain irrational longer than you can remain solvent.” However, we are confident that the long-term investor will be rewarded.

Let’s look at some of the numbers for Citi:

• P/E Ratio = 10.05
• Est. Div. Yield Curr. Yr. = 5.1%
• Est Div. Yield Next Yr. = 5.5%
• Price/Intrinsic Value = 1.00
• Price/Book = 1.73
• Return on Equity = 18.4%
• Net Margin = 24.03%
• Operating Margin = 33.07%

We are not saying that everything is going fine but Citigroup is a cash machine that is currently paying a pretty good dividend. People tend to focus on the problem areas but also forget that Citi has a very diversified portfolio of activities and the management overhaul will start to bear results. A long-term buyer of this stock should be aiming to see it back in the mid 50s within the next 24 months.

Disclosure: none

Comments

[Burns]

It's not just Mr. Prince my patience is wearing thin on, it is also the BOD ( www.newsvisual.com/new... ). I am waiting for them to step in and say "enough is enough, we need to regain shareholder confidence and protect investors" but I haven't seen that yet. In fact, I haven't seen or heard anything from them lately.

[BillCust]

Thanks to people like these I made a lot of money. Keep on chugging the kool-aid friend.