Citigroup Shares Waiting for a Catalyst (NYSE:C)

Citigroup Inc. (NYSE:C) shares have traded between $3.11 and $5.43 over the past 12 months.  Today Citi shares are trading at $3.88, up 0.78% and believe it or not but its stock price has increased 19.85% from its 52-week low.

Citigroup has had some buzz lately with Jim Cramer rating it a "Buy" on July 29th and yesterday (Aug 17th) Standard & Poor's equity analyst Erik Oja maintained his buy rating on Citigroup (C) with a price target of $5.50.

LONG CITI?

Jim Cramer made a recommendation during CNBC's Mad Money on July 29th calling Citigroup Inc. (NYSE:C) a “Buy”.  During his Lightning Round segment, Cramer's comments were:
"Yes! Yeah, Tim Geithner (Treasury Secretary) is a seller... I'm a buyer! Treasury's been unloading stock... and the stock doesn't go down. What does that tell you? And Vikram Pandit... I think is doing a dynamite job."

If S&P's Oja is right about a $5.50 price target, we all could buy a ton of Citi today at just $3.88 today and in 12 months clock a 41% gain --  wouldn't that be nice.

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(BusinessWeek.com) A U.S. judge said she wasn't ready to approve Citigroup's $75 million settlement with federal securities regulators over claims the bank misled investors by failing to disclose $40 billion in subprime-related holdings, Bloomberg News reported Aug. 17th.

In a posting on the S&P MarketScope service, Oja said that he expects a new settlement to be worked out, "perhaps including additional [Citigroup] employees and a higher settlement amount."

"Still, with the shares trading at a discount-to-peers valuation, we see rising long-term value in the franchise," he said. S&P's 12-month price target of $5.50 is roughly equal to its projection of Citigroup's yearend book value per share, which is below its historical average and the comparable valuation of the company's peers, Oja said.

Fellow Masters, Citigroup had more than 200 million customer accounts and does business in more than 140 countries.  As much as we'd love to buy a 1,000 shares at $3.88 you can't help but have a hard time believing this stock could gain 42% in one year.

Citi is a volatile stock, no doubt about it, but if you believe Oja and Cramer, maybe now is the time to start to accumulate a small position.

Disclaimer: No positions in any of the securities mentioned in this publication.