Despite a sizeable pullback in March, Barclays‘ (LSE: BARC) shares performed well in the first half of 2026. Over the six-month period, they rose around 7%.
I think there’s a good chance they’ll do even better in the second half. Here’s why.
Multiple growth drivers
The way I see it, the set-up for Barclays is very favourable right now. For a start, the bank looks well positioned to generate income growth in the short/medium term.
One key driver here is likely to be investment banking revenues. With mega IPOs like SpaceX taking place, and firms of all shapes and sizes raising capital and doing acquisitions to fuel growth, there should be plenty of opportunities for the firm here.
Another is trading revenues. Financial markets continue to be volatile due to economic/geopolitical uncertainty and this should be creating plenty of opportunities for Barclays’ equity and fixed income traders.
Additionally, there’s wealth management. With markets near all-time highs, Barclays’ Private Bank and Wealth Management (PBWM) division should be cleaning up at the moment, as fees here are linked to assets under management.
Trading at a discount
A second reason I’m bullish on the shares is the valuation. It’s still pretty low, especially compared to some other large-scale banks.
With City analysts expecting earnings per share of 52.5p from the bank this year, Barclays is trading on a forward-looking price-to-earnings (P/E) ratio of just 9.7 right now. By contrast, JP Morgan – which also has trading, investment banking, and wealth management divisions – is about 15.
It’s worth noting that brokers have been raising their price targets recently and many of these are well above the current share price. For example, Jefferies just went to £5.90, which is about 16% above today’s share price.
This kind of broker activity can help to boost a stock. So it’s another factor in the bull case.
Upward share price trend
Finally, the share price is a reason to be optimistic in relation to the outlook. Because it’s in a strong upward trend and trends often stay in place for a while.
Moreover, it recently breached the 500p mark and is currently at levels not seen since 2007. That means there’s likely to be minimal overhead resistance – it’s unlikely there are many investors sitting on losses and waiting to breakeven to sell.
Worth a closer look?
Put all this together and there’s a lot to like about Barclays’ shares, in my view. Ultimately, we are looking at a stock that offers the winning combination of earnings growth potential, a low valuation, and share price momentum.
There are risks around an economic and/or consumer slowdown, of course – banks are always vulnerable here. All things considered however, I believe the shares are worth a look as we start the second half of 2026.
But Barclays isn’t the only stock I like the look of right now…
Should you invest £5,000 in Barclays Plc right now?
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Edward Sheldon owns shares in JP Morgan
