White Tennis Sneakers vs. Citigroup (C) Stock

In this article I’ll evaluate whether white tennis sneakers with a price tag of $46.00 or Citigroup stock currently trading at a price of $46.74 represents the better buy.

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White Tennis Sneakers – $46.00

I recently purchased these super cute white tennis sneakers:

They’re absolutely perfect for summer!  They match everything.  Pair them with shorts, sundresses, and skirts or skorts for a sophisticated, yet casual look.  Better yet, they’re easy to slip on when you’re running out the door.  I’d even go so far as to say they’re a closet staple.  They’re also SOOO comfy; it feels like you’re walking on clouds.  Like with any shoes, they’re bound to get dirty and being white, I expect them to show every speck of dirt.  Even still, if you can manage to keep them looking clean, they’re an incredibly versatile piece of footwear.  

These shoes retail for $46, but you can score 20% off with my code: September20. What a deal! If you’re interested in purchasing a pair, you can access them through clicking this link.

Citigroup (C) Stock – $46.74

Now, let’s compare that to a stock you can purchase for about the same price: Citigroup (C).  One share of C stock is currently trading for $46.74 at the time this article is being written.  For those of you unfamiliar with the company, Citigroup defines itself as a global diversified financial services holding company that serves consumers, corporations, governments and institutions with a broad, yet focused, range of financial products and services. According to Citigroup’s annual 10K report for the fiscal year ended December 31, 2022, the company serves approximately 200 million customer accounts and conducts business in nearly 160 countries and jurisdictions.  The company has an extensive history as well, dating back to the founding of the City Bank of New York in 1812.

Diving into the financials, C looks it could potentially be undervalued. It has a price to earnings (P/E) ratio of 6.32, meaning that for every $1 of earnings you’ll need to pay $6.32. This is considered low on a historical level, as the average P/E ratio for S&P 500 companies in Q4 of 2022 was 22.24 according to YCharts. Another measure of value is the price to book (P/B) ratio. Currently, Citigroup’s P/B ratio is 0.49, representing phenomenal value. It’s worth noting, however, the company’s largest assets represent investments and loans to customers. These asset classes are highly susceptible to macroeconomic and geopolitical conditions, including inflation, interest rates, and volatile economic growth.

Citigroup has also assumed a fairly significant amount of debt. It’s total debt to capital ratio stands at 76.99%. I typically prefer scouting out companies with lower levels of debt. Yet, if you’re a risk taker, you may feel comfortable investing in highly leveraged companies. As the old adage goes: greater risk, greater return! Despite being highly leveraged, Citigroup’s profit margin is a whopping 11.87%. This is reflected in the dividend yield of 4.43%, or $2.04 per share on an annualized basis. Not bad, right? As an equity investor, you either make money by recognizing capital gains or collecting dividend income. It’s ideal when you can achieve both at the same time!

Overall, based on its fundamentals, I think Citigroup represents an interesting buying opportunity. I think it’s quite possible that Citigroup could outperform it’s rivals and the broader market in general over the long-term.

Decision Time

So, which do you think is the better purchase? Are you a fan of the white tennis sneakers or could you do without? What about Citigroup? Could it prove to be a worthwhile addition to your investment portfolio?

Again, if you’re interested in purchasing the white tennis shoes please use this link and don’t forget to use code September20 to receive 20% off your full order.

* Ratios and financial metrics provided by Fidelity as of 7/3/2023, the date this article was written.

* Please review our Investment Disclaimer Policy. The Chic Capitalist is committed to providing independent equity research. At the time of publication, The Chic Capitalist and its affiliates do not own a direct financial interest in the aforementioned stock.