Earlier this week, Berenberg’s Michael Christodoulou published a fresh note on Barclays (LSE: BARC) shares, and it was notably upbeat.
He initiated coverage with a Buy rating and a 620p target price, implying a roughly 21% rise from the 511.5p close on 23 June 2026.
That’s on a share price that has already surged around 160% over the past two years. So why does he expect even more growth – and is that view widely shared?
Why Berenberg sees more good news
Christodoulou’s core argument is that the sharp share‑price rise is mainly the market catching up with improving earnings rather than an excessive re‑rating.
Barclays delivered diluted earnings per share (EPS) of 43.8p for 2025, up from 36p the prior year. Its return on tangible equity (RoTE) was 11.3%, in line with management’s 11%+ target.
Even after the rally, he still sees the shares as cheap relative to European peers, pointing to a discounted valuation despite that earnings progress. With a trailing price-to-earnings (P/E) ratio around 11.8 and a forward P/E near 9, it’s below the broader financial sector.
In simple terms, he thinks investors are paying a modest multiple for a bank that’s now delivering double‑digit returns.
On top of that, he noted the bank’s clear earnings visibility, largely driven by Barclays’ structural hedge. By locking in interest rates with long‑term swap contracts and renewing them as they mature, the bank smooths out its interest income.
As such, earnings don’t swing around every time market rates move. That gives the bank a more predictable income stream as rates move — a comfort when the macro picture is shaky.
What do other analysts think?
From what I can see, Berenberg isn’t an outlier. Recent broker data shows a cluster of optimistic targets:
| Broker | Rating | Target price |
|---|---|---|
| Berenberg | Buy | 620p |
| JPMorgan | Overweight | 600p |
| Jefferies | Buy | 590p |
| RBC | Outperform | 575p |
Overall, the average 12-month target is around 10% to 20% above the current price, following several upgrades or target increases.
But that doesn’t mean the stock is risk‑free, with politics the key concern. Andy Burnham is widely seen as the key contender to replace Keir Starmer as Labour leader and as Prime Minister, with prediction markets giving him a clear edge.
Burnham has already called for “strong public control” over key industries and AI, which worries markets that bank regulation and oversight could tighten. If that happens, banks like Barclays might face tougher rules or higher costs.
The bottom line
The UK economy is dealing with a tricky mix of slower growth, stubborn inflation and political uncertainty – none of which is ideal for banks. But Barclays comes into this period with a solid balance sheet, rising earnings and a structural hedge that helps stabilise income as rates shift.
For investors chasing long‑term exposure to UK banking, I’d see Barclays as a reasonable candidate to consider: not bomb‑proof, but supported by decent fundamentals and a line‑up of analysts who still expect further gains.
The big question is whether future regulation and the next phase of the economy will let that structural advantage fully play out.
Should you invest £5,000 in Barclays Plc right now?
When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.
And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Barclays Plc made the list?
Mark Hartley does not hold any positions in the companies mentioned.
