Citi - a hope and a prayer?
CitiGroup - C has been one of the most actively traded stocks recently trading between 275 - 532 million shares a day. So much interest but it it all just a hope and a prayer? For the 2 people out there that don't know what Citi does it is a leading global financial services company, has some two hundred million customer accounts and does business in more than hundred countries, providing consumers, corporations, governments, and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, and wealth management. Major brand names under Citigroup's trademark red umbrella include Citibank, CitiFinancial, Primerica, Smith Barney, and Banamex.
When I step back and really look at how Citi has performed it has gone nowhere. According to BarChart the stock has advanced only 5 times in the last 65 days and then for only a .52% gain. Flat to say the least. BarChart's technical indicators have 12 of 13 signalling sell for an overall sell rating of 88%.
With stats like that why is everyone so high on this stocks? There are 20 Wall Street analysts following this stock and 17 have a hold or buy. Only 3 recommend a sell or under perform. Wall Street Survivor has a 5/5 Survivor Sentiment rating and over on Motley Fool the CAPS members are voting 7190 to 1756 that the stock will outperform the market. Even the All Stars vote 1328 to 438 and are in agreement with the 34 Wall Street columnists Fool follows who like it 32 to 2. How do you say self fulfilling prophesy?
I'm sorry but when I invest in the stock it has to be both popular and technically sound and I don't feel that way with Citi. I'm not sure which bank will perform best and survive in this recovery but there seems to be a lot of people that think Citi is the best. I'm going to be different and pass on this one.
If you just have to invest in a bank I'd go for a financially sound regional or if you can't make up your mind try an ETF like IShares Dow Jones US Regional Banks -- IAT
Jim Van Meerten is an investor who writes about financial matters here and on Financial Tides. Please leave a comment here or email FinancialTides@gmail.com.
Disclosure - no positions in this stock at time of publication