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Non-Tech : C (Citigroup)

C 100.23

+1.1%

3:59 PM EDT

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From: JakeStraw	7/18/2018 12:21:54 PM
	of 259

Greenhaven Associates Chairman Edgar Wachenheim says shares of Citigroup are set to double to $130 by 2020. cnbc.com "All I can do is buy stocks that I think are deeply undervalued. The numbers on Citigroup were clear: They had their meeting about a year ago — July of last year — and they projected $9 per share of earnings for 2020," Wachenheim said at the Delivering Alpha conference in New York. "That $9 a share was based on the old tax rate. If you increment it to the new tax rate, it’s now $10.20." "So all I can do is say take the different businesses within Citigroup and come to some conclusion," he told CNBC's Jim Cramer. "We came out to about 13 times earnings, so it would be a $130 stock." Purchase, New York-based Greenhaven invests with a three- to four-year time horizon and manages approximately $7.5 billion for wealthy families, university endowments and nonprofits. From 1988–2017, the average annual return of a Greenhaven portfolio had been roughly 19 percent (before fees). Wachenheim, who also founded the management company, argued that Citi's success in its corporate cash management business is especially important to his valuation of the big bank. Citi's stock traded 0.75 percent higher late Wednesday morning. "Some of their businesses are really good. They’ve got Trade and Treasury Solutions: It’s a very good business; they and J.P. Morgan sort of dominate it," he said. "It’s a very high return business. That’s worth more than 16 times earnings."

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