Citibank's Top US Picks for 2007

For those who might find this useful, here are Citibank’s top US picks for 2007

Sorted by Total Return

Ticker    29-Dec  Target    Gain   Yield Tot Ret

NOV       $61.18 $102.00  66.70%   0.00%  66.70%
NTRI      $63.39 $105.00  65.60%   0.00%  65.60%
BOW       $22.50  $35.00  55.60%   3.50%  59.10%
ISIL      $23.92  $37.00  54.70%   1.00%  55.70%
FNSR       $3.23   $5.00  54.80%   0.00%  54.80%
LEN       $52.46  $80.00  52.50%   1.30%  53.80%
SWN       $35.05  $53.00  51.20%   0.00%  51.20%
UNH       $53.73  $81.00  50.80%   0.00%  50.80%
HES       $49.57  $73.00  47.30%   0.80%  48.10%
QCOM      $37.79  $55.00  45.50%   0.90%  46.50%
SRZ       $30.72  $44.00  43.20%   0.00%  43.20%
BEAS      $12.58  $18.00  43.10%   0.00%  43.10%
WMB       $26.12  $35.00  34.00%   1.40%  35.40%
DOX       $38.75  $52.00  34.20%   0.00%  34.20%
FCX       $55.73  $72.00  29.20%   3.60%  32.80%
DST       $62.63  $83.00  32.50%   0.00%  32.50%
INTC      $20.25  $26.00  28.40%   2.00%  30.40%
GOOG     $460.48 $600.00  30.30%   0.00%  30.30%
APH       $62.08  $80.00  28.90%   0.20%  29.10%
CBH       $35.27  $45.00  27.60%   1.50%  29.10%
ETE       $31.40  $39.00  24.20%   4.80%  29.00%
KLAC      $49.75  $63.00  26.60%   1.00%  27.60%
LIZ       $43.46  $55.00  26.60%   0.50%  27.10%
SBUX      $35.42  $45.00  27.00%   0.00%  27.00%
LUV       $15.32  $19.40  26.60%   0.10%  26.70%
AMT       $37.28  $47.00  26.10%   0.00%  26.10%
URBN      $23.03  $29.00  25.90%   0.00%  25.90%
WYE       $50.92  $63.00  23.70%   1.90%  25.70%
OI        $18.45  $23.00  24.70%   0.00%  24.70%
AAP       $35.56  $44.00  23.70%   0.70%  24.40%
ARE      $100.40 $122.00  21.50%   2.90%  24.40%
CTAS      $39.71  $49.00  23.40%   1.00%  24.40%
GPN       $46.30  $57.00  23.10%   0.20%  23.30%
NLC       $20.46  $25.00  22.20%   0.00%  22.20%
WMI       $36.77  $44.00  19.70%   2.40%  22.10%
CBF       $15.71  $18.00  14.60%   7.30%  21.90%
MDP       $56.35  $68.00  20.70%   1.10%  21.80%
CELG      $57.53  $70.00  21.70%   0.00%  21.70%
ADBE      $41.12  $50.00  21.60%   0.00%  21.60%
BWA       $59.02  $71.00  20.30%   1.10%  21.40%
MIR       $31.57  $38.00  20.40%   0.00%  20.40%
GME       $55.11  $66.00  19.80%   0.00%  19.80%
LOW       $31.15  $37.00  18.80%   0.60%  19.40%
TXT       $93.77 $110.00  17.30%   1.60%  19.00%
HSY       $49.80  $58.00  16.50%   2.30%  18.80%
DE        $95.07 $110.00  15.70%   1.90%  17.60%
HPQ       $41.19  $48.00  16.50%   0.80%  17.30%
MO        $85.82  $97.00  13.00%   3.90%  17.00%
HOLX      $47.28  $55.00  16.30%   0.00%  16.30%
MAR       $47.72  $55.00  15.30%   0.50%  15.80%
SGMS      $30.23  $35.00  15.80%   0.00%  15.80%
UPS       $74.98  $85.00  13.40%   2.00%  15.40%
AOC       $35.34  $40.00  13.20%   1.70%  14.90%
CEG       $68.87  $77.50  12.50%   2.30%  14.90%
FRE       $67.90  $76.00  11.90%   2.80%  14.70%
LLL       $81.78  $93.00  13.70%   0.90%  14.60%
VIAb      $41.03  $47.00  14.60%   0.00%  14.60%
SCHW      $19.34  $22.00  13.80%   0.50%  14.30%
AVP       $33.04  $37.00  12.00%   2.20%  14.20%
ROP       $50.24  $57.00  13.50%   0.40%  13.90%
HIG       $93.31 $104.00  11.50%   2.10%  13.60%
PEP       $62.55  $70.00  11.90%   1.60%  13.50%
LAMR      $65.39  $74.00  13.20%   0.00%  13.20%
BAC       $53.39  $58.00   8.60%   4.20%  12.80%
MDT       $53.51  $60.00  12.10%   0.70%  12.80%
LNC       $66.40  $73.00   9.90%   2.30%  12.20%
POT      $143.48 $160.00  11.50%   0.40%  11.90%
CYN       $71.20  $76.00   6.70%   2.30%   9.00%
AGN      $119.74 $130.00   8.60%   0.30%   8.90%
EFII      $26.58  $28.00   5.30%   0.00%   5.30%
BBEP      $24.10  $21.50 -10.80%   6.90%  -4.00%
MYD       $15.52
NFJ       $25.10
PPT        $6.43

And their Top Sells

Ticker    29-Dec  Target    Loss   Yield Tot Ret

ECA       $45.95  $47.00   2.30%   2.60%   4.90%
MTB      $122.09 $115.00  -5.80%   2.00%  -3.80%
OSG       $56.30  $52.00  -7.60%   1.80%  -5.80%
ENDP      $27.58  $25.00  -9.40%   0.00%  -9.40%
WHR       $85.87  $75.00 -12.70%   2.00% -10.70%
EK        $25.80  $22.00 -14.70%   1.90% -12.80%
AET       $43.18  $36.00 -16.60%   0.00% -16.60%
VZ        $37.24  $29.00 -22.10%   4.30% -17.80%
BSX       $17.18  $14.00 -18.50%   0.00% -18.50%
CBS       $31.18  $24.00 -23.00%   2.60% -20.40%
MEE       $23.23  $17.00 -26.80%   0.70% -26.10%
NYT       $24.36  $17.00 -30.20%   3.00% -27.20%

Encana’s been a sell since last year, in my book.

So I guess citibank has been doing this for a while. What was their historical success rate?

From the same report[quote]How Did We Do Last Year? Reviewing Our 2006 Top Picks

In the following table we present the performance of our 2006 Top Picks, which averaged a share price return
of 14.0%, slightly besting the S&P 500 of 13.6%. Based on total return (which includes dividends), the Top Picks 2006 were in line with the S&P at 15.8%. (We note that past performance is not indicative of future performance.)

Who performed best? Of our current analysts, Liz Osur, with GameStop, had the best return, at 73.2%. (GameStop rode the wave of new console launches, including Xbox 360, PlayStation 3, and Wii. We should point out that Liz sees more room to go for GameStop (GME, target price $66), as it is her top pick again this year. Pat Burton was a close second last year with CB Richard Ellis (the world’s largest commercial real estate company), up 69%. Pat’s Top Pick this year: DST Systems (total expected return to his $83 target: 33%). Rounding out our top five were Cisco (Alex Henderson, up 60%); Human Genome Sciences (Yaron Werber, up 45%), and Mediacom (Jason Bazinet, up 47%). In all, 21 of last year’s 72 Top Picks had 20%-plus returns.

Top Picks Methodology

The Top Picks are those stocks that our U.S. equity analysts believe will be the best performers within their respective coverage universes for the coming year. The performance of each stock is measured to the end of the period, even if an analyst downgrades the stock during the year. The exceptions to this rule occur when an analyst leaves the firm and/or when coverage is dropped. In these cases, share price performance is measured until coverage is dropped. In 2006, five stocks were priced at the dropped coverage date due to analyst departure or termination of coverage. If these five stocks had been held until the end of the period, results would have been slightly higher. Calculating the performance of the full list, including those stocks, through December 29, 2006 resulted in a total return of 18%. (Share price return alone would have been 16.2%.)[/quote]
Ha! Looks like they only did as much as the market. Go buy an index

what abou their worst picks and worst performers?

You seem to be new at this. Don’t expect them to publish those. You’ll have to work that out yourself. I expect the conclusions about the same - no better or worse than the market

But re-read my last post, and buy an index or broad market ETF instead.

Buy MO; be happy.

Ok, I’m no expert but I’ve been wanting to print out that chart and start working down the list. I finally started doing that. Only partway through, but here’s some of my prelim thoughts:

Favorite so far for a quick 20 - 25% buy and sell profit: SWN (natural gas)
finance.google.com/finance?q=SWN

Also very attractive: CBH (bank holding co), that’s been going up very steadily but is suddenly plummetting down now due to regulatory probe. Ie., it’s cheap and presumably the fundamentals remain sound and it will rebound nicely.

Also interesting: DST, APH

Nice REIT: ARE

Surprising to see a homebuilder near the top of the list (LEN). I thought that industry is in trouble for the foreseeable future.

Starbucks (SBUX) is cheaper than I realized, at $35/share, maybe worth considering. Certainly it should be able to hit $40 - 45 within the next year.
finance.google.com/finance?q=SBUX

But, as I said, I don’t know what the hell I’m doing, though I’m enjoying checking out their picks. Thanks.

Incidentally, they do recommend one stock I own, Medtronic, which I bought in the mid '90s and was on a tear then. It’s since been less impressive but is a massive provider of medical technology.
finance.google.com/finance?q=MDT

You seem to be new at this. Don’t expect them to publish those. You’ll have to work that out yourself. I expect the conclusions about the same - no better or worse than the market

But re-read my last post, and buy an index or broad market ETF instead.[/quote]

You seem to be new at saracsm. I was referring to the analysts not the stocks, and of course they wont print them out, but flip a coin enough times and year after year, given enough analysts, you’ll always have some “star peformer”. I ranked 78 / 16,000+ participants in the ASX stock market game, but I don’t consider myself a “star performer”. I’d only start to think that perhaps I was pretty good after years of consistently higher returns.

As for citibank, 0.7% above the index is pretty crappy… thats what happens when you move so much money that every move affects the market. So tell me, why would I pay attention to the recommendations of a bank that hardly outperforms the market average?

Also, can you get the total returns predicted for 2006 and do a retrospective check to see how they performed on their predictions. (on a per share basis).

I’m not sure that’s true. Isn’t it a sign of success to beat the market at all?

investopedia.com/articles/mu … 070203.asp

socialinvest.org/areas/gener … iduals.htm

So was citibank’s performance inclusive of fee’s? (I agree by the way about funds… I’d never invest in them…nor would I invest in an index unless I knew nothing about the market but wanted to capitlise on the future growth of the country)

I guess I have set higher standards for myself than beating the average by less than 1%. I pick the stocks individually, and right now (at least on the ASX) there are slim pickings.

Can someone with more investment expertise than me please provide their opinion of CBH?
finance.google.com/finance?q=CBH

I finished reviewing all of the Citibank picks at the first page of this thread, and that’s my favorite. It’s a reputable bank holding company whose stock price has steadily risen in the past few years and which pays dividends regularly, but which is right now, this very month, substantially cheaper due to a regulatory probe into possible wrongdoing by top officers.

I figure the stock dropped more than it should have due to fears of investors, while the company remains very strong and even actual findings of wrongdoing shouldn’t affect the company so seriously so the stock, which dropped from 36 to 32 in the past month, should be trading at 36 again within a couple of months and perhaps up to 40 by the end of the year.

What do you think?

I think its very interesting. I like these kind of investment opportunities, its how I made good money with Multiplex with the Wembley Stadium fiasco. In this case, I think that most likely even if someone was found to have done the wrong thing, he/she will be punished, not the shareholders. I think the only real risk is that they’ve been cooking the books. If its some corruption scandal rather than accounting, then I think you will be right MT. See if you can find out whether they’re investigating corruption or accounting irregularities.

Likewise, I almost doubled my money on Noven Pharmaceuticals, a company that makes transdermal pharmaceutical patches, because I bought after their price dropped sharply following the report of a study linking hormonal supplements for women to cancer (hormonal patches was one of their biggest sellers). I figured the study was inconclusive and investors probably overreacted. Sure enough, the study related to oral hormones, not transdermal, the stock did rebound quickly and I sold.

Sounds quite likely there was wrongdoing in this case. CBH (Commerce Bancorp) is a chain of banks on the East Coast of the US that was founded 30 years ago by a Wharton graduate who also excelled in fast food franchises and real estate. The company has grown very quickly and today has over 400 branches and over 10,000 employees. The stock price has also risen very steadily over the past decade. But, the founder has long been accused of wrongdoing, buying lots of land and leasing it to the bank for its sites (though he claims at FMV) and using his wife’s design company to provide services for the bank.
courierpostonline.com/apps/p … 10371/1006
phoenix.bizjournals.com/southflo … ily18.html

But despite all of that, the company’s earnings increased 11% in 2006 and 68% in the 4thQ, and their plans for continued expansion with dozens of new branches every year seem very credible.

Yes and no. Perhaps the founder and his family earned a few million in shady deals. But there have been no broader allegations, that the whole financial reporting for the company is flawed. So, the way I see it, the worst that can happen is the company will endure bad press and spend a lot of time and money on defending these allegations and in the end the founder and perhaps some other cronies may be penalized or, worst case scenario removed from their jobs. But even all that, bad as it may sound (and I’m hoping it won’t turn out that bad), doesn’t take away from the great real-life success of the company with its 400+ branches, 10,000+ employees, and $1.6B annual revenue.

Check out CBH’s performance over the past decade and then look at the past 3 months and tell me it’s not time to buy (although that’s what most analysts are saying).
tools.morningstar.com/charts/Mch … H&sLevel=A

I admit, I’ve made some bad decisions in the stock market, but this latest one – CBH – is a winner. On Jan 11 the OP posted Citibank’s top picks from December, when they recommended CBH at its then price of $35.27 and set their target at $45. As you can see, it’s performance over the past 10 years has been outstanding.

I didn’t check it out till Jan 18. By chance, just a few days earlier the company announced that it was the subject of a regulatory probe and its shares plummeted from almost $35 to about $31. I figured it was an overreaction, but didn’t buy till the price was back up to $32.8. As you can see, it has rebounded nicely and I expect it to hit my target of $40 in a few months, for a gain of 21.9%.

We’ll see. It’s been on a roll the past 10 days anyway.

Anyone else find anything they like in the Citibank picks? What about you Lingchen (the OP)?