Just went to Vegas and bet C!
There is no way around it. Betting on Citicorp is like going to Las Vegas and putting some chips on red or black. Well…I just threw down some chips on C. I am telling myself I’d love to own this stock for the next 20 years because the upside is big. We’ll see about that. The reality is I think it’s 50/50 whether I win or lose on this stock. The 50% chance I win is based on the following:
1. John Paulson has recently bought a big position.
2. Hopefully, the worst of the recession is over.
3. I like the banking sector overall because, even though there has been a run up, some banks like Citicorp still have a long way to get to get back to legitimacy. IF they get back, the stock has upside.
On the 50% chance I lose, it is probably based on the following:
1. The company is in really bad shape right now and just doesn’t ever figure it out.
2. I am not convinced the current CEO is the right guy for the job (I bet if they found a good bank guy, the stock will go up).
3. Other banks are fairing much better.
4. Stocks really shouldn’t be this scary to own. I have plenty of stocks, that while they will go up and down, they are good solid companies you can really feel good about.
5. Commerical Real Estate problems bury Citicorp.
There are probably more reasons but this is how I based my decision. Let me know if you find compelling reasons for or against owning Citicorp.
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