Lloyds share price: Deutsche Bank trims valuation on group and peers

on Jan 11, 2019
Updated: Mar 11, 2020

Deutsche Bank has trimmed its price target on Lloyds Banking Group (LON:LLOY) and blue-chip peers Royal Bank of Scotland (LON:RBS) and Barclays (LON:BARC), following what it said was ‘annus horriblis’ for European lenders, Proactive Investors reports. The analysts, however, have retained their bullish stance on the UK lenders.

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Lloyds’ share price has slipped into the red in today’s session, having given up 0.77 percent to 54.36p as of 13:53 GMT. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.45 percent lower at 6,911.29 points. The group’s shares have given up more than 22 percent of their value over the past year, as compared with a near 11-percent drop in the Footsie.

Deutsche Bank trims stance on Lloyds

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Deutsche Bank, which rates Lloyds as a ‘buy,’ lowered its price target on the shares from 77p to 68p today. Proactive Investors quoted the analysts as commenting that while return on tangible equity expectations were broadly stable at 10 percent, the sector price to tangle book value ratio had fallen to 0.8x from 1.1 x, marking a 30-percent de-rating.

“The sector is currently pricing in a 100-percent recession probability,” the broker pointed out, adding that its house view did not “factor a recession until late-2020 although there are a number of geopolitical risks that could derail this – including the US-China trade war, Brexit, and Italy”.

Other analysts on bailed-out lender

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UBS and Royal Bank of Canada, which also rate Lloyds as a ‘buy,’ both set price target on the shares of 80p this month. According to MarketBeat, the FTSE 100 lender currently boasts a consensus ‘buy’ rating and an average price target of 76.19p.

As of 14:16 GMT, Friday, 11 January, Lloyds Banking Group share price is 54.36p.

Royal Bank of Scotland Finance & Banking Stock Market