Hargreaves Lansdown says that while Barclays’ (LON:BARC) first-quarter loss was a disappointment, it was not a disaster, Citywire. The comments came after the FTSE 100 lender updated investors on its first-quarter performance yesterday.
Barclays’ share price fell in the previous session, shedding 1.41 percent to close at 210.00p. The shares underperformed the broader UK market, with the benchmark FTSE 100 index adding 42.11 points to end the session 0.57 percent higher at 7,421.43.
Barclays results ‘not a disaster’
Citywire quoted Hargreaves Lansdown’s analyst Laith Khalaf as commenting yesterday that while there was ‘a lot not to like’ about Barclays’ first-quarter results, many of the issues were one-offs and stripping these out ‘performance has been a disappointment rather than a disaster’. The FTSE 100 group disclosed yesterday that it had made a loss before tax of £263 million in the first quarter of the year due to litigation and conduct charges of £2 billion.
He added that beyond litigation, the bank was hampered by a weak dollar and ‘lacklustre’ performance in UK banks.
“Barclays plans to pay a 6.5p dividend this year, which represents a yield of around 3% [...] that would be a return to where the dividend was before it was halved in 2016, but for income-seekers that still compares unfavourably to what’s on offer from Lloyds and HSBC,” Khalaf pointed out, adding that the group had to “show some profit credentials to attract investors” and there was not much evidence of that in the latest results.
Other analysts on lender
Cfra, which sees Barclays as a ‘buy,’ set a price target of 270p on the shares yesterday, while Morgan Stanley, which is ‘neutral’ on the shares, set a valuation of 225p. According to MarketBeat, the FTSE 100 group currently has a consensus ‘buy’ rating and an average price target of 228.95p.