Cramer on BloggingStocks: Hold Citi for a Double

Posted Dec 21st 2009 9:20AM by Jim Cramer
Filed under: Market Matters, Citigroup Inc. (C), Wells Fargo (WFC), Stocks to Buy, Cramer on BloggingStocks

From TheStreet.com Network

TheStreet.com's Jim Cramer says the dilution here was expected, and this one is marching higher.

What do you with Citigroup (C) (Cramer's Take) if you bought it on the deal now that you are up so huge? I'd keep it.

Remember, there were two variables to this deal -- how much raising the TARP return money would hurt the stock and how much the government's sale would hurt the stock. We saw the underwriting knock off about 60 cents from the stock, and we are getting the distinct view from Washington that there is no consensus between Treasury and the FDIC about what should be done with the government's stake beyond holding it for a while.

My view on this stock is that it was working its way ever higher before it had to raise the money and that the dilution, while meaningful, was always expected (a la Wells Fargo (WFC) (Cramer's Take), which is working its way back up nicely).

The consensus is in with the second year of Vikram Pandit's reign that he is a total failure. But I think that's too harsh. This was the most poorly run major bank out there and we still have no idea what it really owns -- and that is totally wrong.

But he will muddle through over time and get the balance sheet right and Citi Holdings -- the junk portfolio -- right as it runs off, and you will end up with a decent stock that could double over the next year.

Why not hold it?

Random musings: I'm seeing multiple positive stories about the fertilizers. The group fell prey to lower prices, but I still think it's not going back to the old bear days.

Jim Cramer is co-founder and chairman of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer had no positions in the stocks mentioned.

Tags: c, featured, jim cramer, JimCramer, wfc

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Reader Comments (Page 1 of 1)

12-21-2009 @ 3:12PM

Mike McKibben said...

Is that a 'double' by a clean hit, or will it be with an 'error' or a steal ?

12-21-2009 @ 4:11PM

Sheldon L said...

LMAO...

Start story with Citi and conclude with fertilizer!

12-21-2009 @ 4:18PM

MSF said...

MY CITIBANK CREDIT CARD HAD A $20,000 CREDIT LINE, WHEN I HAD REFINANCED MY HOME I SENT A CHECK TO ENGLEWOOD CLIFFS ,NJ FOR THE BALANCE. IT WAS SIGNED FOR AND RECEIVED BY A. WOLFE. IT DISAPPEARED, AND WAS NEVER EXPLAINED WHY. I INFORMED MY FAMILY IN LONG ISLAND WHO KNEW THE FBI, AND HAD WORKED WITH FAMILY FRIEND, BILL MOHR, AT THE NY AG'S OFFICE. IT WAS HUSHED UP. AND THE BILLIONAIRE PROPERTY OWNER (PHIL ANSCHUTZ) NEXT TO MINE IN MISSOURI, FLEW INTO TO NY, AND WROTE A CHECK TO NY AG, ELLIOT SPITZER, FOR OVER $4 MIILION (SUPPOSEDLY, FOR IPO SPINNING). MR. GALLO, LATER WROTE ME A LETTER, AFTER I FILED A CLAIM, AND SAID, THEY COULDN'T HELP ME. THEY LATER, CUT OFF CONTACT WITH INFORMATION FLOW TO MY FAMILY ON LONG ISLAND, NY. I'VE YET TO RECEIVE ANY JUSTICE, OR COMPENSATION...............................