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No. of Recommendations: 1
Citigroup (NYSE: C) was the fifteenth stock mentioned in this post: , which makes it next up for review.

Citigroup is a major bank. I don't own its shares, but I do own some bonds.

Dividends: Citigroup recently paid a dividend of $0.51 per share per quarter, and it's due to announce its next dividend soon. If it keeps to recent trends, it will hold its dividend flat for this quarter. It did recently suspend its share buybacks, but I have not seen anything about its dividend, yet. Assuming its dividend holds steady, it has a yield of around 4.3%, and that dividend represents around 24% of its trailing earnings. The dividend increased 3 payments ago from $0.45 per share per quarter, around 13%. Based on its dividend, I'm wiling to continue holding onto the bonds I own.

Balance Sheet: Citigroup has nearly $24 billion in cash and equivalents and nearly $170 billion in deposits with banks on its balance sheet. It reports a net equity position around $190 billion. And of course, on top of its own equity, it has the backing of a very active Federal Reserve that is helicoptering money around like there's no tomorrow. At this point, I'm not overly concerned about Citigroup's balance sheet, but we'll see what unfolds as the economy progresses from here on out. Based on its balance sheet, I'm willing to continue holding onto the bonds I own.

Valuation: Assuming Citigroup survives this crisis and we return to something resembling normalcy by 2021, I estimate Citigroup to be worth around $60.20 per share based on a discounted earnings model. At a recent price of around $47.41 per share, it appears to be valued a little below that fair value estimate. Based on its valuation, I'm willing to continue holding onto the bonds I own and would be willing to consider buying shares.

Next Steps: I plan to hold onto my Citigroup bonds, and I also plan to add Citigroup to my list of potential stocks to buy if it still looks reasonably priced if and when I get additional cash to invest.

Discovery/HR Home Fool
Disclosure: I own Citigroup Bonds
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