THANKS, CITIGROUP. WELL DONE. REALLY... WELL DONE. by Brian Hunt
We've checked and checked, and we are now sure – Citigroup wasn't joking when it "downgraded" shares of Foster Wheeler (FWLT) yesterday.
Foster Wheeler is one of the world's largest engineering and construction companies... the builders of roads, bridges, ports, refineries, pipelines, and other huge energy projects. We watch this stock for the same reason we watch Freeport-McMoRan. It's one of the big "bell cows" of infrastructure and commodity demand.
Like all infrastructure shares, FWLT has been clobbered this year. Shares are down 68% from their summer highs. Now, here's where it gets funny: Analysts from Wall Street giant Citigroup just cut their rating on the company from "buy" to "hold." It seems they've finally noticed global economic weakness will hurt profits. No doubt Citi's clients are thinking, "Now ya tell me!"
Citigroup shares are down 75% since June 2007 because the company thought investing in loans people couldn't pay back was a good idea. Our suggestion to shareholders of Citi: Hire a gang of chimpanzees to manage the company and perform analysis for you. They'll do the same job for much less pay.