From Standard & Poor's Equity ResearchOPPENHEIMER RATES CITIGROUP UNDERPERFORM
Oppenheimer analyst Meredith Whitney sees Citigroup (C), as a stock trading under $5, as a speculative investment and appropriate for risk-tolerant investors.
Whitney estimates Citi's risky assets to be roughly $120 billion, but notes that the company has almost $600 billion in consumer and card loans. She says she's unclear exactly which assets are targeted in the $306 billion guarantee by the government.
She says clearly this will stabilize the group near term and the stocks this morning should reflect it. But she's still cautious on the potential future dilution from further prospective capital raises for the group and continued higher losses related to credit and asset deflation.
CITIGROUP CUTS ESTIMATES, TARGET FOR COOPER INDUSTRIES
Citigroup analyst Jeffrey Sprague says Cooper Industries (CBE) pre-announced that it would fall short of its previous fourth quarter EPS estimate of $0.83-$0.92.
Sprague notes that no new guidance was provided, but this looks like a major miss. He says CBE is seeing weakness in all lines of business, indicating that basically anything that can be deferred is being deferred. Notes halt in activity is so severe that CBE is closing many of its plants for the remainder of the year.
He cuts $3.62 2008 EPS estimate to $3.40, $3.45 for 2009 to $2.90, and $3.70 for 2010 to $3.25. He also cuts his $24 price target to $20. He keeps a sell opinion on the stock.