Barclays, the Financial sector company, was revisited by a Wall Street analyst today. Analyst Alvaro Serrano from Morgan Stanley reiterated a Buy rating on the stock and has a p455.00 price target.
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Alvaro Serrano has given his Buy rating due to a combination of factors including the strong performance in Barclays’ net interest income (NII) divisions, particularly in the UK and US markets. The increase in NII has been a significant driver of earnings, with the UK Corporate and US Cards segments showing notable growth. This positive trend in NII has led to an upward revision in earnings per share (EPS) estimates for the coming years.
Furthermore, the US Consumer Bank division has shown promising signs of improvement, with better deposit funding and renegotiated profit-sharing terms contributing to a strong return on tangible equity (ROTE). Despite some challenges in the investment banking sector, Barclays is expected to maintain a solid ROTE and has room for operational efficiency improvements. The bank’s commitment to a substantial total distribution, primarily through buybacks, also supports the Buy rating, as it provides flexibility for future strategic initiatives.
In another report released today, Bank of America Securities also reiterated a Buy rating on the stock with a p450.00 price target.