What do you with
if you bought it on the deal now that you are up so huge? I'd keep it.
Remember, there were two variables to this deal -- how much raising the TARP return money would hurt the stock and how much the government's sale would hurt the stock. We saw the underwriting knock off about 60 cents from the stock, and we are getting the distinct view from Washington that there is
between Treasury and the FDIC about what should be done with the government's stake beyond holding it for a while.
My view on this stock is that it was working its way ever higher before it had to raise the money and that the dilution, while meaningful, was always expected (a la
, which is working its way back up nicely).
The consensus is in with the second year of Vikram Pandit's reign that he is a total failure. But I think that's too harsh. This was the most poorly run major bank out there and we still have no idea what it really owns -- and that is totally wrong.
But he will muddle through over time and get the balance sheet right and Citi Holdings -- the junk portfolio -- right as it runs off, and you will end up with a decent stock that could double over the next year.
Why not hold it?
At the time of publication, Cramer had no positions in the stocks mentioned. Jim Cramer is co-founder and chairman of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for
Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. To order Cramer's newest book -- "Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer),"
click here. Click
here to order "Mad Money: Watch TV, Get Rich," click
here to order "Real Money: Sane Investing in an Insane World," click
here to get "You Got Screwed!" and click
here for Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he appreciates your feedback and invites you to send comments by
TheStreet.com has a revenue-sharing relationship with Amazon.com under which it receives a portion of the revenue from Amazon.com purchases by customers directed there from TheStreet.com.