Barclays Share Price Forecast November 2021 – Time to Buy BARC?

Shares of British multinational universal bank Barclays(LSE: BARC) are in the green today, currently trading around the 193p mark at the time of writing. The biggest news out of the company in recent days is the resignation of chief executive Jes Staley who has been serving in the post since 2015. Staley is widely credited with refocusing Barclay’s strategy and hiring the current senior management team.

Barclays – Technical Analysis

According to the financial statement released by Barclays, the current market cap of the bank is at £32.162 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 for Barclays such as Relative Strength Index (14)( 46.07),  Stochastic %K (14, 3, 3)(22.61), Average Directional Index (14)(19.11) and Awesome Oscillator(3.29) are neutral. Moving averages such as Exponential Moving Average (10)(197.09), Simple Moving Average (10)(198.77), Exponential Moving Average (20)(196.47) and Simple Moving Average (20)(198.06) are indicating a sell action.

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Recent Developments

As mentioned before, the stepping down of chief executive Jes Staley is the biggest news coming out of the bank. According to the information revealed, the decision came as a result of Staley’s previous relationship with sex offender Jeffrey Epstein. The investigation of that relationship was conducted by the Bank of England, which has informed Barclays about the conclusions. According to Barclays, the investigation could not find any complacency between Staley and Epstein’s crimes. While the exact details have not been made public, Staley is prepared to contest them. CS Venkatakrishnan is said to replace him.

Barclays shares have experienced a 6% increase in October and 70% overall in the past 12 months. The bank released its Q3 results on 21^st October. It remained defiant against the international backlash against investment banking. Unlike some of its competitors like Lloyds which restructured itself as a UK-centric bank, Barclays has retained its commercial operations worldwide.

This move seems to be working well as Barclays recorded a pre-tax profit of £2 billion in the quarter and £ 6.9 billion in the last 9 months. This turned out to be Barclay’s best-ever Q3 year-to-date profit, at a time when other companies are recovering from the pandemic downturn. It raked in £1 billion in fees from investment banking. Barclays also has a strong balance sheet and has recorded CET1 ratio of 15.4% which s more than its target range of 13% to 14%. This suggests that its shareholders can be in line for receiving some decent returns over the medium term.

Should You Buy BARC Shares?

Investors interested in Barclays should look at the risks involved. The market can experience problems in the winter ahead due to a combination of influenza and Covid-19. The outlook looks still pretty shaky even though the UK economy looks set for a strong bounce back. While the recent economic strength is caused by the strong month the banking sector experienced, the inflation rates are rising. This may result in an increase in interest rates for banks. The Bank of England has, however, voted for no change when it comes to interest rates.

BARC shares have also taken a hit by the unexpected departure of CEO Jes Staley. While the bank does have succession plans in place, it’s still a major source of uncertainty for the top level. While many investors could go for Lloyds for having a safer strategy, Barclays cannot be neglected. On today’s valuation, Barclays should very much be on an investor’s list of shares to buy.

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