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Citigroup (NYSE:C) Bullish on Emerging Markets
Posted by: | CommentsSeveral Citigroup (NYSE:C) executives stated recently they’re very bullish on emerging markets, and valuations should be attractive based on a variety of factors related to growth.
David Ratliff, MD & Head-Investor Sales (AsiaPac), said, using India as an example, that “the debate in India is whether the economy grows at 7-8% or 5-6% which is a quite healthy debate to have given that most of Europe and North America is barely growing.”
China has a similar trend right now, with expectations they won’t grow at double-digit rates, but should continue growth in the high single-digits.
The problem in emerging markets isn’t so much the companies operating there, but those companies outside the region which were projecting their own growth based on demand which they thought would be higher. That seems to have changed now, so even though when comparing some emerging market growth with Western countries it looks impressive, in fact it has settle some, and growth rates will be slower going forward.
That doesn’t mean emerging markets are a bad investment and opportunity in any way, just that they are settling down to more sustainable rates than they have been growing at in the recent past.
Global Equity Strategy, at Citigroup, Robert Buckland says they’re advising clients on emerging markets to “buy on dips but to be very careful about chasing the rallies.”
One caveat to me is the emerging economic conditions which could completely skew these bullish sentiments from Citigroup. All of it assumes a best case scenario which factors in an already slowing down global economy.
If that changes to a much worse scenario, which it probably will all the positive factors cited by Citigroup will fall by the wayside, although I agree that there will be growth in some emerging markets, especially Asia, no matter how bad things get.
Even with things slowing down, there just isn’t any other place to go in equities when considering growth as the chief factor.
This article (Citigroup (NYSE:C) Bullish on Emerging Markets) was originally developed by and is property of American Banking News. Checkout American Banking News for up-to-date banking news and peer to peer lending news.
Citigroup (NYSE:C) Settles Cemetery Case for $1.5 Million
Posted by: | CommentsCitigroup (NYSE:C) agreed to pay $1.5 million to settle the case where
they were accused of not properly supervising employees who were under suspicion over mishandling trust fund of cemeteries located in Tennessee and Michigan, by the Financial Industry Regulatory Authority, which oversees brokerages.
According to the Financial Industry Regulatory Authority, Citigroup “failed to reasonably supervise the handling of these accounts by inadequately responding to a succession of ‘red flags’–failures that permitted the scheme to continue undetected until October 2006,”
The fine or sanctions were $750,000, while the other $750,000 which made up the overall $1.5 million, came from the return of the commissions generated from the activities.
Mark Singer was the broker involved with the scheme, which he evidently worked out with two customers he had, where over $60 million in funds were misappropriated from 2004 through 2006.
A mistrial was recently declared in Singer’s court appearance, although there are other charges he will have to defend against. One of the customers involved in the scheme, Clayton Smart, is facing criminal charges in Michigan and Tennessee.
Smart evidently acquired cemeteries in Michigan in 2004 from trust funds which were then wrongly transferred to a company owned by Smart.
From there Smart other trust funds to acquire funeral homes and cemeteries located in Tennessee.
This article (Citigroup (NYSE:C) Settles Cemetery Case for $1.5 Million) was originally developed by and is property of American Banking News. Checkout American Banking News for up-to-date banking news and peer to peer lending news.
Citigroup (NYSE:C), Bank of America (NYSE:BAC) Up Six Times by 2015 Says Dick Bove
Posted by: | CommentsRochdale Securities analyst Dick Bove has been giving bank stocks a lot of love lately, and among the largest banks, he sees Citigroup (NYSE:C) and Bank of America (NYSE:BAC) exploding by six times what they are today by 2015.
In a Tuesday report, Bove said he sees Citigroup increasing in share price of $24.75 by 2015, over six and a half what it is today, and Bank of America charging to $99.37 by 2015. That’s also well over six times what Bank of America is trading at today.
The optimistic projections of Bove are based on a price-to-book ratio of $12.37 for each company. Today, Citigroup has a price-to-book ratio of 0.72, and Bank of America 0.73.
If you think that’s optimistic, when Bove focuses on the bigger regional banks, he ups the ante even more, saying he sees financial institutions like PNC Financial (NYSE:PNC), Capital One Financial (NYSE:COF) and M&T Bank Corp. (NYSE:MTB) being up even more. Unfortunately, Bove didn’t go into detail on his reasoning behind the regionals.
There are a number of caveats to Bove’s analysis, as when examining the banking data, he admits there aren’t any trends that can be identified in the group, being confirmed by metrics like price-to-earnings, price-to-book and price-to-revenue.
The foundation to Bove’s performance assertions are an economy that will continue to improve. With the dark clouds of European sovereign debt and China inflation hanging over the the global economy, it’s hard to see him stick his neck out this far on the stocks, when we are in very real danger of entering into a potentially deeper recession than the one that is still lingering with us.
Bove also cites data from the FDIC which he concludes give a picture of stability in operating revenues over the last four years, which would include the recession. That seems to imply that Bove thinks even if there are hard times ahead, the banks could ride it out. It’s doubtful they could, but evidently Bove either thinks they can, or doesn’t believe it’s going to get that bad.
He doesn’t think Wells Fargo (NYSE:WFC) and JPMorgan (NYSE:JPM) will perform as strongly as the other major banks, but he still sees them doing well, although at about half of what the other banks will do, according to his estimates, which would still be worth three times what they are today.
With no identifiable trends and the economic crisis brewing, this seems far too optimistic of an outlook, and it could only happen if the crisis isn’t as bad as it seems at this time, which would help these stocks even more, as an increased optimism would arise, which could generate a self-fulfilling prophecy.
This article (Citigroup (NYSE:C), Bank of America (NYSE:BAC) Up Six Times by 2015 Says Dick Bove) was originally developed by and is property of American Banking News. Checkout American Banking News for up-to-date banking news and peer to peer lending news.