Shares of Amazon.com Inc. rallied Monday after Citigroup doubled its sales expectation for the company's Kindle product, calling it "the iPod of the book world."

The shares rose 9% to trade at $87.76. Volume of 10.6 million shares outpaced the issue's 30-day average volume of 9.1 million shares.

Citigroup expects Amazon to sell 380,000 Kindle units in 2008, up from the 190,000 units it had previously forecast. Based on the revised forecast, the firm now sees Kindle-related revenue of $1 billion for the online retailer by 2010. It had previously predicted sales of $400 million to $750 million.

"This could amount to 4% of Amazon's total revenue impressive, given the size of the company's revenue base," Citigroup wrote.

Amazon introduced Kindle, a portable reading device, in Nov. 2007. It sells for $359 and allows users to wirelessly download books and magazines to an electronic display.

"Just as important, Kindle's apparent success highlights the very significant and consistent innovation focus that Amazon has maintained over the past five years and helps hedge the company against the digitization of media products."

Citigroup affirmed its buy rating and $97 price target on Amazon.

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