Friday, July 16, 2010

"Citigroup Profit Falls as Trading Revenue Drops" (C)

UPDATE II: "On The Call: Citigroup CFO Talks Loan Losses" (C)
UPDATE I: The stock is trading down 5.2% i.e. lower than when we started rah-rahing it at $3.95. "Citigroup Earnings: Three Analyst Takeaways" (C)"

Original post:
No surprise.
We'll have more throughout the day.
Premarket, the stock is sitting at the former resistance, $4.08, down 8 cents.
From BusinessWeek:
Citigroup Inc., the third-biggest U.S. bank, said profit dropped 38 percent, beating analysts’ estimates even as stock and bond trading revenue fell. An improving credit outlook allowed the company to reduce reserves against future losses.

Second-quarter net income was $2.73 billion, down from $4.39 billion in the same period a year earlier, New York-based Citigroup said today in a statement. The per-share profit was 9 cents, exceeding the 5-cent average estimate of 18 analysts in a Bloomberg survey.

“Citigroup, despite the turbulence in the markets, appears to have turned the corner and its plan is on track,” said James Ellman, a former Merrill Lynch & Co. bank-stock portfolio manager who is now president of San Francisco-based hedge fund Seacliff Capital. “We’ve seen problem credit-card loans come down for the industry, which Citi is heavily into.”

Stock and bond trading revenue tumbled as Greece’s debt crisis and a stalled U.S. economy snapped the streak of profitable trading days that pushed Citigroup’s first-quarter results to the highest in almost three years. Chief Executive Officer Vikram Pandit signaled in April that results at the bank, which lost a combined $29 billion in 2008 and 2009, would “continue to reflect the pace of economic recovery and the level of activity in capital markets.”
‘Earnings Potential’...MORE