Citigroup has slid nearly 3 per cent in pre-market trading on Monday after Goldman Sachs downgraded the stock to its “Americas sell list” from “neutral,” warning of many industry- and firm-specific challenges in the next six months, which will ultimately drive the No. 1 U.S. bank’s underperformance relative to its peers.
Goldman assumes Citi will take an $11-billion (U.S.) write-off in the fourth quarter of 2007, at the high end of the bank’s guidance, and also an additional $4-billion write-off in the first quarter of 2008 on its remaining subprime and collateralized debt obligations portfolios.
The brokerage also cut its price target on Citigroup $33, dropping its 2008 and 2009 earnings estimates to $3.80 a share and $4.60 a share, from $4.65 and $5.20, respectively.
Citi shares are changing hands at $33.08, down from Friday’s NYSE close of $34.
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