The Barclays (LSE: BARC) share price has put in a stunning 190% gain over the past five years. But City analysts are still bullish, with a strong Buy consensus. In fact, of the 16 I can find making recommendations on the stock, none has it as a Sell.
That’s a good start, but where do they think the share price is likely to go next? Barclays shares are at 499p at the time of writing (19 June), and I’m seeing an average price target of 545p currently. It suggests a modest, but welcome, 9.2% increase if it comes good. And we’ve just had a new, even better, broker upgrade.
Price target rising
Bank of America just lifted its Barclays share price target to 600p, and that would mean a much more desirable 20% jump. As it happens, the previous target was already ahead of the average at 570p. And Bank of America is firmly in the Buy camp.
Earnings momentum is looking stronger than analysts had previously expected. The first quarter of the year saw revenue and earnings ahead of consensus, with impressive figures across the board…
Barclays delivered another solid quarter with a 13.5% RoTE in Q126, and double-digit returns in all our businesses. This was despite a one-off charge and impairments in the quarter. Top line income grew 6% year-on-year, driven by broad based divisional performance including in the Investment Bank, where we generated over £4bn quarterly income for the first time.
— CEO C. S. Venkatakrishnan, 2026 Q1 results
With a forward price-to-earnings (P/E) ratio of under 10, it would be hard to see Barclays shares as too overvalued. But does it make the shares cheap enough to buy in the current climate? That’s tricker.
Brighter horizon
I like to see a company repurchasing its own shares, for two main reasons. Firstly, it means future earnings and dividends will be spread over fewer shares, so each one should get a little bit more. The fact that management chose that means of returning cash over a special dividend also suggests they see the shares as undervalued — and that’s a welcome vote of confidence.
At Q1 time, Barclays announced a new £500m share buyback. And it’s in addition to the £1bn buyback previously announced with 2025 results in February.
So everyone thinks everything is rosy and nothing can go wrong? Well, maybe not quite. My Twelfth Magpie colleague Ken Hall recently noted that Barclays
carries significant investment banking exposure compared to some of its peers. Revenues in this segment are notoriously volatile and can swing sharply with market activity. And as a major UK lender, a domestic economic downturn could also put both loan book growth and loan impairments under pressure.
And a forecast dividend yield of just 1.8% is really nothing to get excited about.
Good investment?
I have to confess I’m torn right now. On fundamentals and long-term outlook, I’d rate Barclays as definitely one to consider. But I’m not sure the current valuation has enough safety room to cope with any potential economic shock. It might be better to think about waiting.
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Alan Oscroft does not hold any positions in the companies mentioned.
