Prior to the open, Citigroup (C) reported another quarter of solid earnings, backing up my long-held investment thesis that the financial was a huge value. During the quarter, the large financial ramped up capital returns, providing a large tailwind that the market keeps fighting.
The stock ended down some 3.4% in trading for the day. Citigroup is up substantially over the last year so investors are probably taking profits making the question whether investors should follow this initial move by the market.
For a long time now, my investment thesis was simple: focus on the consistent earnings and strong capital returns of the financial that was trading far below book value. At $72 now, the equation has changed slightly but the recommendation stands to still not get lost in the quarterly details.
