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Barclays | At the Beginning of a Great Journey

Current price – £2.18
Target price – £2.57
Growth potential – 17.9% 🔥
Dividend yield – 3.7% 💵
Investment horizon – 1 year
🏦Barclays is one of the largest financial institutions in the world. At the core of its business is Barclays Bank PLC, which is the second largest by assets in the UK. The company's shares are traded on the London Stock Exchange (LSE) and the New York Stock Exchange (NYSE). Barclays has adopted a new long-term strategy aiming for significant revenue growth by 2026. The fair value of the company's shares is £2.57, with a growth potential of 17.9%. The dividend yield is 3.7%.
Investment thesis

🔼 New strategy and improved financial performance. At the beginning of 2024, Barclays announced a new strategy that involves a large-scale restructuring of all divisions. The first outcomes were reflected in Q1 2024. The group posted a profit of £1.55 billion after a loss in Q4 2023. Revenue amounted to £6.95 billion, which was 4% less than the same period a year earlier. Both indicators were above market expectations. By 2026, Barclays intends to increase annual revenue to £30 billion. During the period from 2024 to 2026, it plans to distribute £10 billion to shareholders through dividends and share buybacks.

🔼 Dividends and buyback. Barclays pays dividends twice a year. The current dividend level is £0.08 per year, which means a dividend yield of 3.7% in sterling. This level is a fairly good addition to the potential share price growth.

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