Schaeffer's Street Chatter Highlights the Following Stocks: Citigroup, Rambus, and Charles Schwab.

CINCINNATI -- Today's "Street Chatter" from Schaeffer's Investment Research focuses on: Citigroup (NYSE:C), Rambus (NASDAQ:RMBS), and Charles Schwab (NASDAQ:SCHW). "Street Chatter" is a report that analyzes three newsworthy stocks that are generating a lot of attention on Internet message boards. "Street Chatter" is published on www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research.

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Street Chatter:

Citigroup

It seems like Citigroup (NYSE:C) is making headlines every time I'm slated to write "Street Chatter" for the week. Bright and early this morning, C reported first-quarter net income of $1.12 per share, compared with year-ago results of $1.04 per share. Revenue rose five percent to $22.18 billion. On average, analysts were expecting the financial-services firm to earn $1.02 per share. In other news, C announced plans to buy back an additional $10 billion worth of shares. The Dow component is currently higher by about one percent.

Technically speaking, C continues to grind its way higher, enjoying the support of its 10-day and 20-day moving averages in the process. The support of these short-term trendlines has allowed the equity to rally nearly nine percent higher since C set a near-term bottom in early February. However, I remain concerned about the stock's ability to overcome long-term resistance at the 50 level. You can see the degree of this resistance by checking out a monthly chart on the security.

Quick Facts on C

--Percent of analysts tracked by Zacks who rate the stock with a "buy": 58%

--Number of analysts tracked by Zacks: 14

--Short interest as a percent of float: 0.54%

--Short-interest ratio: 2.00

--Schaeffer's put/call open interest ratio (SOIR): 0.57

--SOIR percent rank: 4.00%

--Overall Schaeffer's Equity Scorecard rating: 4.0

The sentiment toward C leaves those bullishly inclined toward the stock with very little hope of a continued rally. However, I said this last time I covered the equity, and the shares continued to rally despite the apparent lack of buying power. That said, I still hold the shares in a bearish light, as Wall Street continues to maintain its bullish outlook, options players are more bullish than they have been 96 percent of the time during the past year, and short-covering support is practically nonexistent.

Click the following link to see a Daily chart of Citibank since February 2006 with 10-day and 20-day moving averages: http://www.schaeffersresearch.com/wire?ID=15805 .

Rambus

The scrappy semiconductor company Rambus (NASDAQ:RMBS) is another favorite of mine that I get to cover in "Street Chatter" on a regular basis. You may remember that I was bullish on the shares on March 23, and since that time, RMBS has rallied more than 22 percent. Today, the stock has received a bit of a boost following comments from W.R. Hambrecht that stated that the brokerage believed that RMBS will win its trial against Hynix Semiconductor. According to the firm, they believe that "... after attending the hearings in the past weeks, including the closing arguments, is that Rambus was able to put up a persuading case on why Hynix infringed on its patents."

This hope that RMBS will win yet another patent trial has sent the shares higher by more than five percent so far today. The shares are now trading at levels not seen since March 2001. However, RMBS is struggling a bit with overhead resistance at the 45 level. But I wouldn't count the chips champ out just yet, as technical support is rising into the area in the form of its 10-day and 20-day moving averages. RMBS has not closed a session below this dynamic duo since February.

Quick Facts on RMBS

--Percent of analysts tracked by Zacks who rate the stock with a "buy": 33%

--Number of analysts tracked by Zacks: 3

--Short interest as a percent of float: 9.40 %

--Short-interest ratio: 2.38

--Schaeffer's put/call open interest ratio (SOIR): 0.57

--SOIR percent rank: 93 %

--Overall Schaeffer's Equity Scorecard rating: 9.0

I want to point out first that RMBS's legal success has not gone unnoticed by the financial media. In fact, two articles appeared last month that highly touted the company and the shares: Investor Business Daily's "After Series Of Deals, Rambus Branches Out" published on March 24, and Barron's "Crazy for Rambus" published on March 4.

However, despite this furor in the media, it appears that investors have not taken notice. Options players have increased their bearish bets, pushing RMBS's SOIR from a reading of 0.34 in the 28th percentile on March 17 to today's perch in the 93rd percentile. Furthermore, there are plenty of shorted shares to fuel a covering rally. And Wall Street has yet to take anything but a passing interest, as only three analysts currently follow the shares. Any positive initiations could provide additional buying power for the shares.

A bit of consolidation around the 45 level is to be expected, especially since the verdict on the mentioned case has not been announced as of yet. However, with a Schaeffer's Equity Scorecard rating of 9.0 out of 10, I would be willing to play calls ahead of the official announcement.

Click the following link to see a Daily chart of Rambus since February 2006 with 10-day and 20-day moving averages: http://www.schaeffersresearch.com/wire?ID=15805 .

Charles Schwab

We wrap up today with another member of the earnings parade. Charles Schwab (NASDAQ:SCHW) posted first-quarter earnings of $243 million, or 19 cents per share, matching expectations. Revenue rose to $1.28 billion versus $1.06 billion a year ago. In the release, CFO Chris Dodds stated that "Improved client asset flows, higher equity valuations, and increased trading activity all contributed to making our first quarter 2006 net revenues the highest in over five years."

Despite the in-line figures, SCHW has sold off to the tune of 2.34 percent so far today. However, the stock appears to be gaining traction in the area of its 10-week moving average. This trendline resides in an area of technical support for SCHW, with the 17 level (a former resistance level) attempting to lend a hand for the shares. Elsewhere, the stock has even outperformed its peers in the AMEX Securities Broker/Dealer Index (XBD) on a daily basis since February. Not too shabby when you are going up against the likes of Morgan Stanley (MS), Goldman Sachs (GS), and J.P. Morgan Chase (JPM).

Quick Facts on SCHW

--Percent of analysts tracked by Zacks who rate the stock with a "buy": 27%

--Number of analysts tracked by Zacks: 15

--Short interest as a percent of float: 1.76%

--Short-interest ratio: 2.48

--Schaeffer's put/call open interest ratio (SOIR): 0.47

--SOIR percent rank: 55%

--Overall Schaeffer's Equity Scorecard rating: 7.0

Sentiment readings on SCHW are pretty complacent when looking at the options players and short-interest data. However, the firm's brokerage-firm brethren have given the equity the cold shoulder, as 11 of the 15 covering analysts rate the shares a "hold" or worse. Naturally any upgrades could prove to be a boon for the stock.

With a solid uptrend in place, and plenty of room for analyst upgrades, SCHW earns a Schaeffer's Equity Scorecard rating of 7.0 out of 10. Personally, I'm leaning toward the bullish end of the spectrum myself on SCHW.

Click the following link to see a Weekly chart of Charles Schwab since April 2005 with 10-week and 20-week moving averages: http://www.schaeffersresearch.com/wire?ID=15805 .

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Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method .