Citigroup Inc (NYSE:C) — This company is a major global provider of a wide range of financial services to corporate customers and consumers. These include consumer banking and credit, corporate and investment banking, securities brokerage, and wealth management for consumers, corporations, governments and institutions.
In mid-April, the company reported an 86% sequential increase in revenue, as well as a 21% year-over-year jump in first-quarter profit.
Following that report, S&P Capital IQ reiterated its “buy” rating and increased its 12-month target for C stock by $1 to $60. Its analysts applauded Citigroup for its expense controls, trading revenues and stable interest margin. They also raised their 2015 EPS estimate to $5.45, up from $5.35, and they anticipate earnings of $6 per share in 2016.
It should be noted that the institutional holding in C stock is about 70%, which indicates a high opinion on The Street, but could also cause extreme downside volatility in the event of an earnings disappointment.
Since its January low, C stock is up 16% and pushing against a major resistance line at $54.10. The line represents the top of an ascending wedge, a bullish pattern that usually breaks to the upside.
Supporting a probable breakout is a golden cross (50-day moving average moves up through the 200-day moving average), a long-term buy signal, and higher accumulation on up days versus down days.
MACD is currently flat, but a breakout should result in a delayed buy signal from that indicator.
Buy C stock with a trading target of $60 in 30 days, which would result in a one-month return of 11%.
