Dumb Money Averaging Down?

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Citigroup, Inc. (NYSE: C): 10:53 AM NYC time, November 27th: Just a quick comment on the “Citigroup Receives $7.5 Billion Capital Infusion from Abu Dhabi” story. As you may know, the largest individual Citi shareholder is Saudi Prince Alwaleed bin Talal, son of the founding king of Saudi Arabia. Citi shares are down almost 50% in the past six months. Now more money is flowing in from the Middle East. Is it dumb money averaging down? The trailing dividend yield is over 6%, which is attractive…


if the dividend is maintained at current levels. The banking stocks should certainly be on your watch list because they will — one day — be great buys. Comments? Cheers, chrisco

Here’s the blurb from the Wall Street Journal:

Citigroup’s statement on receiving a $7.5 billion cash infusion from Abu Dhabi’s investment arm.

NEW YORK, Nov. 26 — Citi announced today that it has reached an agreement to sell Equity Units, with mandatory conversion into common shares, in a private placement to the Abu Dhabi Investment Authority (ADIA), a long-term investor committed to the U.S. capital markets, in the amount of $7.5 billion. ADIA’s aggregate ownership in Citi’s common shares, including the conversion of these Equity Units, will total no more than 4.9% of Citi’s total shares outstanding.

“This investment, from one of the world’s leading and most sophisticated investors.” [right!]

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