Do Goldman’s Citigroup Numbers Finally Add Up?

Goldman analyst William Tanona has not had anything good to say about Citigroup recently, and is unlikely to change his tune after recalibrating his earnings model to correct for an error:

Goldman analyst William Tanona issued a note correcting his previous estimate for a profit of 15 cents a share. The earlier projection was based on a ``miscalculation in our model,’’ he said. Tanona’s office referred questions to Ed Canaday, a Goldman spokesman, who declined to comment beyond the note. Bloomberg

Tanona had cut numbers across all the banks and brokers on February 25th; apparently nobody caught his error until now.

Tanona and the sovereign wealth crowd are not the only ones piling on Citigroup today ; influential Merrill Lynch analyst Guy Moszkowski is also getting in a few shots as shareholder contemplate a quote in the teens:

Citigroup may have $15 billion of writedowns this quarter tied to subprime mortgages and so-called collateralized debt obligations, leaving the bank with a net loss of $1.66 a share, Merrill Lynch & Co. analyst Guy Moszkowski said today in a note. Moszkowski, ranked the No. 1 bank analyst by Institutional Investor magazine, was followed by a Goldman Sachs Group Inc. analyst who said the bank would lose $1 per share.

``We remain concerned about loss provision potential, the direction of long-term strategy and weak markets,’’ Moszkowski said.

The error in Goldman’s financial model is the latest twist in this saga; can it get any stranger?

Todd Thomson might be laughing, but grown men on trading desks are starting to cry.

Citigroup Falls to Lowest Since 1998 as Analysts Project Loss
Bloomberg
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The content contained represent the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author.

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