Insider Trading Report: Citigroup (C)

Lew Jacobs, a director at Citigroup (C), recently added 10,000 shares. The buy came to just over $440,000, and increased the director’s stake by 77 percent. He now owns over 22,900 shares.

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  • The trade marks the first move by insiders since August 2019. Insiders have mostly been sellers in the past two years, but have been inactive for a prolonged time. The last sales were at prices 30-37 percent higher than where shares currently trade.

    The big banks have had to contend with a financial crisis, and now low-interest rates, which may impact the bank’s profitability for years. Shares of the firm have dropped nearly 40 percent in the past year.

    Action to take: Insiders own just 0.25 percent of shares, not a huge amount. However, the recent buy is a solid indication that the worst is likely over for shares. With big banks prevented from increasing dividends of buying back shares right now, a recovery is likely to take time.

    Investors can buy shares at less than 9 times earnings and with a 4.7 percent dividend yield here.

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  • Traders may do well with the March 2021 $50 calls. Trading for around $1.55 per contract, they could offer high-double to low-triple digit returns on a bounce higher in shares. Traders should look for a quick profit though, as shares look most likely to trade sideways.