Veteran bank analyst Richard Bove, at Rochdale Securities, said some investors are betting that Citi shares will triple in three years.
People are buying it now in expectation of the triple because they made the decision that all of the negatives that could happen don't mean anything, Bove said.
Citi shares were up 24 cents, or 5.8 percent, at $4.37 in early afternoon trading on the New York Stock Exchange. The shares have soared 56 percent during the past month, a bigger jump than any of their peers in the KBW Banks Index <.BKX>.
Shares fell to a low of 97 cents in March as fears mounted about the firm's toxic investments and government intervention.
Citi received $45 billion of bailout money from the U.S. Treasury's Troubled Asset Relief Program, known as TARP, and the government now owns a 34 percent stake in the company.
But shares are rebounding after higher-than-expected second-quarter earnings and a high-level management shake-up.
Citi shares are still well below their 52-week high of $23.50 in October.
(Reporting by Steve Eder; Editing by Steve Orlofsky)