Berenberg stays at 'buy' on Barclays, trims target price

In their opinion, investors craved greater consistency in the lender's returns.

Nonetheless, they were in effect being paid to wait.

Since the 2021 financial year, Barclays had achieved a return on tangible equity in excess of 10% and of 13.2% in the first half of 2023.

But its shares were changing hands at just 0.5 times their tangible book value and fell 5% on the back of its latest results, due to weaker-than-expected revenues.

On the other side of the ledger, they believed that Barclays's returns would be supported by a long-term net interest income tailwind, cyclically stronger investment banking activity and robust asset quality.

"Considering a c6% annual dividend yield and c5% buybacks, investors are increasingly being paid to wait while Barclays demonstrates greater RoTE consistency," they said.

Berenberg did however trim its target price on the shares from 270.0p to 260.0p.