NEW YORK (TheStreet) -- Shares of Citigroup (C) are down 8% this year through Thursday's close, setting up a golden opportunity for investors, according to Bank of America Merrill Lynch analyst Erika Najarian.
Citigroup's shares closed at $48.25 Thursday, trading for 0.9 times their reported Dec. 31 tangible book value of $55.38, and for 8.4 times the consensus 2015 earnings estimate of $5.76 a share, among analysts polled by Thomson Reuters. The consensus 2014 EPS estimate is $5.01.
That's among the cheapest forward price-to-earnings ratios for all U.S. bank stocks, and Citigroup is the only large-cap bank trading below tangible book value.
The nation's largest banks trade at significant discounts to regional banks and to the S&P 500 ^GSPC, and there is good reason for this, because the big banks face much greater regulatory scrutiny, have higher capital requirements, and in many cases are continuing to clean up legacy messes left over from U.S. the housing crisis.
But Citi is the cheapest in part because of its unique international flavor. During 2013, 56% of the company's adjusted revenue and 62% of its adjusted net income came from outside North America.
This has led to some painful recent action during broad market declines springing from economic reports showing slowing manufacturing growth in the United States and China, as well as the concern over capital flight from emerging market economies.
In a note to clients on Friday, Najarian reiterated her "buy" rating for Citigroup, with a $65 price objective, writing in a note to clients, "we believe the pullback in the stock has created an especially compelling entry point for investors."