Citrix Systems: Buy on a pull-back

Further, the Street's tepid attitude toward CTXS has changed as the belief in a bottoming U.S./global recession has gained traction: institutional investors quickly bid-up shares to more than $34 from about $20 just a short two months ago, and Citrix's shares are now over-bought short-term, from a technical standpoint. Hence, a Buy of CTXS on a pull-back to $31-32 is recommended, if the stock gives investors the chance.

Is the increasing excitement regarding Citrix warranted? It is if U.S. information technology spending does not decline by the projected 5-7% in FY2009 A bottoming recession means that forecast is overly pessimistic; a protracted recession, realistic, the latter of which would quickly send CTXS tumbling back to the $25-range. The First Call FY2009/FY2010 EPS estimates for CTXS are $1.63 to $1.66.

Hence, CTXS is not for the squeamish, but given current U.S./international 'green shoots,' the view from here argues the risk/return is favorable for investors who can tolerate moderate risk.

Stock Analysis: Citrix Systems is a moderate-risk stock. Consider buying a 25% position in CTXS on a pull-back to $31-32; then buy another 25% in four months, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, don't buy more than 50% of your CTXS position before October 2009. Sell/Stop Loss if you were to buy shares in this company: $17.

Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.