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发表于 2010-4-19 10:02 AM
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Citigroup (C) Makes The Case It Is Worth At Least $6/Share... Today
--streetinsider
With Citigroup's (NYSE: C) stronger-than-expected results this morning, the company is making a strong case for itself that the stock is worth significantly more.
Citigroup reported EPS of $0.15, versus analysts expectations of $0.00.
If the company can maintain this level of EPS over the year, a strong case could be made that $0.60 EPS for the year is not out of the realm of possibility.
If you take a multiple of 10x on this $0.60 in EPS, then you can get to a price of $6.00 per share. Based on this, $6 is what the stock should be worth - today! Many peers even trade well north of 10x. So if you go to 15x, you can get to a price of $9.
Now that earnings power has returned for Citigroup, you can also assign a higher multiple on Tangible Book Value. Peer multiples on Tangible Book Value, ranged around 1.5x to 1.75x, while Citi's was much lower. Citigroup's Tangible Book Value fell this quarter to $4.09 from $4.15 due to new accounting rules, but if you take a peer multiple even on the lower number you can argue that shares should be worth $6.135-$7.16. |
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