Stock split for Citigroup: Will it work?

Stock split boosts Citigroup's share price. The big question: Will reverse stock split bring in institutional investors?

|
Larry Downing/Reuters/File
The Citibank logo is seen at branch in Washington April 18, 2011. Citigroup hopes its 1-for-10 reverse stock split will boost the value of its stock and make it more attractive to institutional investors.

By Giovanny Moreano, quantitative analyst for CNBC.com

Citigroup's 1-for-10 reverse stock split took effect today, decreasing the company's shares outstanding to about 2.9 billion, and boosting its share price to around $45.

Prior to the financial crisis, in December 2006, Citigroup shares reached an all-time high level of $57. By March 5, 2009, Citi shares fell below $1, trading as low as $0.97.

Since January 2009, the stock has remained in the single digits, trading below $6 until today.

Following Citi's reverse split, will large investors such as pension funds and mutual funds, which are usually barred from owning stocks under $5, reach for the carrot?

Click on the chart above to see some of the stock splits in the past year in the S&P 500 and how those stocks performed.

You've read 3 of 3 free articles. Subscribe to continue.
QR Code to Stock split for Citigroup: Will it work?
Read this article in
https://www.csmonitor.com/Business/Latest-News-Wires/2011/0509/Stock-split-for-Citigroup-Will-it-work
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe
CSM logo

Why is Christian Science in our name?

Our name is about honesty. The Monitor is owned by The Christian Science Church, and we’ve always been transparent about that.

The Church publishes the Monitor because it sees good journalism as vital to progress in the world. Since 1908, we’ve aimed “to injure no man, but to bless all mankind,” as our founder, Mary Baker Eddy, put it.

Here, you’ll find award-winning journalism not driven by commercial influences – a news organization that takes seriously its mission to uplift the world by seeking solutions and finding reasons for credible hope.

Explore values journalism About us