Barclays Share Forecast January 2022 – Time to Buy BARC?

Shares of British multinational universal bank Barclays (LSE: BARC)are in the green today, currently trading at 210.40p at the time of writing. BARC rose around 24% in 2021 and rose further when the Bank of England raised interest rates. As 2022 begins, investors are wondering whether the bank is still in a strong position.

Barclays – Technical Analysis

According to the financial statement released by Barclays, the market cap of the bank is at £34.642 billion with total assets worth £1.407 trillion. Revenue for 2020 was at £27.61 billion with a profit margin of 5.53% compared to £30.04 billion in 2019.

 

Oscillators such as Stochastic RSI Fast (3, 3, 14, 14)(98.23), Williams Percent Range (14)(−3.02) and Bull Bear Power(22.88) are neutral. Moving averages such as Exponential Moving Average (10)(200.52),  Simple Moving Average (10)(198.84), Exponential Moving Average (20)(195.17), Simple Moving Average (20)(190.48) and Exponential Moving Average (30)(193.13) are indicating a buy action.

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Recent Developments

Barclays’ American card services division announced a cobranded Mastercard with the airline Emirates. This was the airline’s first US-based co-branded credit card launched in early 2020. The bank was fined £26 million in December 2020 because of the way it treated its customers who fell into debt or experienced financial problems.

Barclays suffered a rocky 2020 after CEO Jes Staley stepped down following an investigation into his relationship with Jeffrey Epstein. The performance of Barclays in 2021 was stellar. The bank’s investment banking segment helped it to outperform its competitors. Investment bank revenue surged by 14% year over year in the third quarter. This was caused by an increase in M&A deals and private equity buyouts. Any decrease In revenues from this segment can be made up for through the company’s lending business. The interest increase from the Bank of England from 0.1% to 0.25% will certainly help things.

On Monday, 10^th January, BARC rose 1.76% in pre-market trading to reach 11.55. The shares haver isen 15.46% over the past month, closing at $9.56 on December 13. They have fallen as low as $9.56 and as high as $11.37 during this period of time.

Should You Buy BARC Shares?

Investors can look to buy shares of Barclays over its other peers in the sector as the bank has more diversification. As an international investment bank, It has proven its credentials by taking in hefty fees from clients looking to raise cash from investors which allowed it to perform through the pandemic. This diversification can come in handy as we enter 2022. Another wave of fundraisings could trigger a third tailwind for the group.

The shares look cheap despite the growth factors. BARC shares are currently trading at a price-to-book value of around 0.6. Barclays offers such potential for the year ahead while trading at such a depressed valuation that few other blue chips can top. However, some of the challenges they have to face may come from inflation, pandemic lockdowns and disruptions to their business.

While there are risks present, it is highly likely that these have already been factored into the share price. Interest rates are likely to keep rising for the next few years, which will further boost Barclay’s share price. The company has also announced an interim dividend of 2p per share, and the full-year dividend is forecast to total around 6p per share. Considering this, you can add BARC shares to your portfolio.

 

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