As a result of the coronavirus pandemic, many leading stocks have suffered significant falls in 2020. Investors looking for promising stock may consider the current Barclays share price to be a good investing opportunity. Barclays Bank PLC (LON: BARC) is one of the UK’s “Big Four” banks and part of the FTSE 100.
Since the stock market crash in March caused by coronavirus, Barclays's share price has had significant negative movement.
Its last market close was 103.36p, which is 42.46% down on its pre-crash value of 179.62p and 41.51% up on the lowest point reached during the March crash when the shares fell as low as 73.04p.
If you had bought £1,000 worth of Barclays shares at the start of February 2020, those shares would have been worth £499.17 at the bottom of the March crash, and if you held on to them, then as of the last market close they'd be worth £609.14.
|52-week range||73.04p - 192.99p|
|50-day moving average||101.3906p|
|200-day moving average||106.6143p|
|Wall St. target price||221.84p|
|Dividend yield||0.09p (3.47%)|
|Earnings per share (TTM)||6p|
The technical analysis gauge below displays real-time ratings for the timeframes you select. This is not a recommendation, however. It represents a technical analysis based on the most popular technical indicators: Moving Averages, Oscillators and Pivots. Finder might not concur and takes no responsibility.
|1 week (2020-10-15)||-2.87%|
|1 month (2020-09-25)||6.23%|
|3 months (2020-07-24)||-14.39%|
|6 months (2020-04-24)||9.75%|
|1 year (2019-10-25)||-42.92%|
|2 years (2018-10-25)||-43.48%|
|3 years (2017-10-25)||-50.63%|
|5 years (2015-10-23)||-61.29%|
Valuing Barclays stock is incredibly difficult, and any metric has to be viewed as part of a bigger picture of Barclays's overall performance. However, analysts commonly use some key metrics to help gauge the value of a stock.
Barclays's current share price divided by its per-share earnings (EPS) over a 12-month period gives a "trailing price/earnings ratio" of roughly 15x. In other words, Barclays shares trade at around 15x recent earnings.
That's relatively low compared to, say, the trailing 12-month P/E ratio for the FTSE 250 at the end of September 2019 (19.71). The low P/E ratio could mean that investors are pessimistic about the outlook for the shares or simply that they're under-valued.
However, Barclays's P/E ratio is best considered in relation to those of others within the banks—diversified industry or those of similar companies.
Barclays's "price/earnings-to-growth ratio" can be calculated by dividing its P/E ratio by its growth – to give 0.6525. A low ratio can be interpreted as meaning the shares offer better value, while a higher ratio can be interpreted as meaning the shares offer worse value.
The PEG ratio provides a broader view than just the P/E ratio, as it gives more insight into Barclays's future profitability. By accounting for growth, it could also help you if you're comparing the share prices of multiple high-growth companies.
However, it's sensible to consider Barclays's PEG ratio in relation to those of similar companies.
|Revenue TTM||£17.8 billion|
|Operating margin TTM||25.47%|
|Gross profit TTM||£19.7 billion|
|Return on assets TTM||0.16%|
|Return on equity TTM||2.96%|
|Market capitalisation||£18 billion|
TTM: trailing 12 months
Environmental, social and governance (known as ESG) criteria are a set of three factors used to measure the sustainability and social impact of companies like Barclays.
When it comes to ESG scores, lower is better, and lower scores are generally associated with lower risk for would-be investors.
Total ESG risk: 30.07
Socially conscious investors use ESG scores to screen how an investment aligns with their worldview, and Barclays's overall score of 30.07 (as at 10/01/2020) is pretty weak – landing it in it in the 62nd percentile of companies rated in the same sector.
ESG scores are increasingly used to estimate the level of risk a company like Barclays is exposed to within the areas of "environmental" (carbon footprint, resource use etc.), "social" (health and safety, human rights etc.), and "governance" (anti-corruption, tax transparency etc.).
To gain some more context, you can compare Barclays's total ESG risk score against those of similar companies.
Environmental score: 0.02/100
Barclays's environmental score of 0.02 puts it squarely in the 2nd percentile of companies rated in the same sector. This could suggest that Barclays is a leader in its sector terms of its environmental impact, and exposed to a lower level of risk.
Social score: 14.24/100
Barclays's social score of 14.24 puts it squarely in the 2nd percentile of companies rated in the same sector. This could suggest that Barclays is a leader in its sector when it comes to taking good care of its workforce and the communities it impacts.
Governance score: 14.85/100
Barclays's governance score puts it squarely in the 2nd percentile of companies rated in the same sector. That could suggest that Barclays is a leader in its sector when it comes to responsible management and strategy, and exposed to a lower level of risk.
Controversy score: 4/5
ESG scores also evaluate any incidences of controversy that a company has been involved in. A high-profile company, Barclays scored a 4 out of 5 for controversy – the second-lowest score possible, reflecting that Barclays has a damaged public profile.
Wondering how that compares? Below are the controversy scores of similar companies.
|Total ESG score||30.07|
|Total ESG percentile||62.22|
|Environmental score percentile||2|
|Social score percentile||2|
|Governance score percentile||2|
|Level of controversy||4|
Dividend payout ratio: 3529.41% of net profits
Recently Barclays has paid out, on average, around 3529.41% of net profits as dividends. That has enabled analysts to estimate a "forward annual dividend yield" of 3.47% of the current stock value. This means that over a year, based on recent payouts (which are sadly no guarantee of future payouts), Barclays shareholders could enjoy a 3.47% return on their shares, in the form of dividend payments. In Barclays's case, that would currently equate to about 0.09p per share.
Barclays's payout ratio would broadly be considered high, and as such this stock could appeal to those looking to generate an income. Bear in mind however that companies should normally also look to re-invest a decent amount of net profits to ensure future growth.
The latest dividend was paid out to all shareholders who bought their shares by 27 February 2020 (the "ex-dividend date").
Barclays's dividend payout ratio is perhaps best considered in relation to those of similar companies.
Barclays's shares were split on a 4:1 basis on 29 April 2002. So if you had owned 1 share the day before before the split, the next day you'd have owned 4 shares. This wouldn't directly have changed the overall worth of your Barclays shares – just the quantity. However, indirectly, the new 75% lower share price could have impacted the market appetite for Barclays shares which in turn could have impacted Barclays's share price.
Over the last 12 months, Barclays's shares have ranged in value from as little as 73.04p up to 192.99p. A popular way to gauge a stock's volatility is its "beta".
Beta is a measure of a share's volatility in relation to the market. The market (LSE average) beta is 1, while Barclays's is 1.2537. This would suggest that Barclays's shares are more volatile than the average for this exchange and represent, relatively-speaking, a higher risk (but potentially also market-beating returns).
To put Barclays's beta into context you can compare it against those of similar companies.
Barclays PLC, through its subsidiaries, provides various financial products and services in the United Kingdom, other European countries, the Americas, Africa, the Middle East, and Asia. The company operates through Barclays UK and Barclays International divisions. It offers financial services, such as retail banking, credit cards, wholesale banking, investment banking, wealth management, and investment management services. The company also engages in securities dealing activities; and issues credit cards. The company was formerly known as Barclays Bank Limited and changed its name to Barclays PLC in January 1985. Barclays PLC was founded in 1690 and is headquartered in London, the United Kingdom.
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