Citigroup May Be the Bank of America of 2013

Tickers in this article: BAC C RF USB WFC

While investors see strong EPS for Citigroup in 2013, that outlook may not be fully reflected in the bank's valuation. As of Friday's close, Citigroup's shares trade at $39.01, 0.7 times their reported Sept. 30 tangible book value of $52.70. In contrast, Bank of America's shares closed at $11.36 on Friday, trading for 0.8 times their reported Sept. 30 tangible book value of $13.48.

In mid-December, Credit Suisse cited other reasons for improving optimism on Citigroup's shares relative to U.S.-centered large cap banking competitors.

Banking analyst Moshe Orenbuch wrote in a Dec. 12 note to clients that Citigroup will grow faster than U.S. peers as its international operations benefit from improving emerging market growth rates, which were headwind in the first half of 2012.

Credit Suisse gives Citigroup a $48 a share price target that values the bank at 0.8 times its tangible book value.

Mosby of Guggenhein Partners still both Bank of America and Citigroup as moving through a post-crisis post-crisis recovery . Other large cap banks such as Wells Fargo (WFC) and U.S. Bancorp (USB) were more prepared heading in the housing bust and are farther along in recovery efforts.

Notably, both banks rewarded Warren Buffett, a large investor, with rising dividends and share repurchase plans in the wake of Fed-mandated stress tests. According to Mosby, Wells Fargo and U.S. Bancorp are among the sector's best capitalized banks, while Bank of America and Regions Financial (RF) still have big work to do after working through writedowns in 2012.

For more on Mosby's banking sector outlook, see why the analyst says banks have 99 problems but liquidity isn't one . Also see the cheapest bank stocks of 2013 .

-- Written by Antoine Gara in New York