Barclays Shares Buy or Sell? - Share Price Forecast

October 25, 2021 23:05 UTC
Reading time: 10 minutes

During the pandemic, Barclays’ share price collapsed to levels not seen since the financial recession.  

However, the British bank’s share price is now up more than 150% with investors now asking: ‘Are Barclays Shares a Good Buy?’  

In this ‘Barclays Shares Buy or Sell or Hold’ guide, we go through the latest facts and investment research and show you how to invest in shares with low commissions.  

Barclays Shares Buy or Sell or Hold? 

Most UK banking stocks had been trending lower even before the pandemic hit. Government regulation, loss of income through the closure of investment banking units and slow developments to compete with fintech banks has plagued the sector for years.  

However, analysts are forecasting a long term period of growth for banking stocks due to the internal changes that have improved banks’ balance sheets. Investors are also bullish on the banking sector as a whole due to central banks starting to increase interest rates – an environment that has historically been good for banks.  

Analysts have also started to turn bullish on banks. While you cannot solely rely on analyst ratings to make investment decisions – as they too can get it wrong – it does provide a good backdrop to help understand the sentiment regarding a company’s fundamentals.  

Source: CNN Money, October 2021 

When analysts give recommendations they have a few options: buy, overweight, hold, underweight and sell. Before you ask yourself: ‘Should I buy Barclays bank shares?’ let’s check what the analysts are saying about the bank.  

Of the 22 analysts polled by CNN Money, there are 15 buy analysts, 1 outperform, 5 hold and 1 underperform with zero in the sell category. What is even more interesting is that the buy ratings have steadily increased over time.  

There is an overwhelmingly bullish bias towards the bank. This provides an interesting backdrop to build upon, as we will when investigating why there are more buy Barclays shares analysts than sell analysts further in this guide.  

Barclays Share Price Forecast in 12 Months 

Before answering the question of ‘Should I buy Barclays shares today?’ it’s good to understand where stock market analysts believe the bank’s share price should be trading in the long term.  

When analysts give stock recommendations, they also usually provide price targets of where they think the stock should be trading. At the time of writing, the highest price target is GBX 315 (£3.15), the lowest price target is GBX 160 (£1.60) and the average or median price target is GBX 234 (£2.34 per share).  

Interestingly, the consensus price target has grown rapidly over the past year, as analysts turn more bullish on the banking sector and Barclay’s in particular.  

Source: MarketBeat, October 2021 

At the time of writing, Barclay’s share price was trading at GBX 200 (£2.00) so a move to just the median price target would represent an uplift of nearly 17%.  

Of course, it’s worthwhile remembering the stock prices don’t just move up and down in one straight line. The share price could drop significantly before moving higher and reaching an analyst’s price target.  

However, it does build a solid foundation to build upon and also highlights the importance of risk management and investing with appropriate position sizes (not too big!).  

How to Buy Barclays Shares 

With Admirals you can buy Barclays shares from three different account types, ensuring you can structure your investment to your own needs and risk profile. These accounts include: 

1. Invest.MT5 Account. This account allows you to buy real stocks and ETFs (exchange-traded funds) from 15 of the largest stock exchanges in the world.  

  • Invest in Barclays with only 0.1% commission.  
  • Enjoy a low minimum transaction fee of just 1 GBP – useful for small accounts! 
  • Invest with a broker authorised and regulated by the Financial Conduct Authority (FCA),  the Cyprus Securities and Exchange Commission (CySEC) and Australian Securities and Investments Commission (ASIC).

2. Trade.MT5 Account. This account allows you to speculate on the price direction of a security using Contracts for Differences (CFDs) on more than 4,000+ financial instruments covering global shares, commodities, indices and currencies.  

  • Speculate on the asset, rather than own the asset. This allows to trade long and short and potentially profit from rising and falling markets.  
  • Trade on margin. This means you can control a larger position with a smaller deposit. For most retail traders this means you may only 20% of the total trade size to be held as a deposit to open the trade. Trading on margin can amplify profits and losses so be careful.  
  • Trade with a broker regulated all around the world and which provides you with a range of trading platforms and upgrades completely FREE! 

3. Demo Account. Did you know you can open a Trade.MT5 and Invest.MT5 demo account completely free? This means you can test out all of the features, services and potential trading ideas yourself in a virtual environment until you are ready to go live.  

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Step by Step Process on How to Buy Barclays Shares 

If you want to know ‘How do I buy and sell Barclays shares?’ then below is a step by step process on how to do so using the MetaTrader 5 web platform provided by Admirals for free.  

  1. Login to the Admirals Trader’s Room. Here, you can access all of the different account types you have, download and upgrade your platforms, access deposit and withdrawals and premium analytical tools.  
  2. Click on the Trade icon next to the account type you want to trade on. You will then be redirected to the MetaTrader 5 Web Trader platform. Type in Barclays in the last row of the Market Watch window on the left.  
  3. To view a live share price chart of Barclays, simply drag the symbol (BARC) onto the chart. The chart will allow you to change timeframes and add on technical indicators for technical analysis.  
  4. To buy Barclays, right-click on the chart and select Trading, then New Order. You will then find a trading ticket will appear for you to input your position size, stop loss and take profit levels. You can open the same trading ticket to sell your shares either at a profit or a loss.  

Source: Admirals MT5 Web Trader 

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Barclays Bank Shares Buy or Sell Research 

A common question among investors is ‘Should I buy Lloyds or Barclays shares?’ Let’s have a look at the fundamentals of Barclays.  

One reason many investors favour analysing Barclays share price rather than other UK banks is that Barclays is a global bank that has multiple revenue streams. For example, Barclays not only operates as a high street bank but also as an investment banking and commercial banking division.  

This diversification has helped Barclays massively. Recent earnings report has shown that Barclays’ profits have surged higher as the investment banking division made nearly £1 billion in deal-making fees. This is largely thanks to a lot of deal-making and mergers and acquisitions in most stock sectors over the pandemic.  

While investment banking revenues are likely to dip at some point, the bank may receive a boost from its traditional banking services due to rising interest rates. The futures market is pricing in an interest rate hike in the future.  

Banks tend to perform well when interest rates rise as it can lead to bigger margins and profits on consumer and business lending. Barclays is well-positioned as a UK bank to capitalise on global trends.  

However, there are some major headwinds for UK companies. The re-negotiation of the Northern Ireland protocol has the potential to cause some serious issues in trade between the UK and Europe which is likely to affect UK companies the most.  

A concerning rise in coronavirus cases in the UK could also dent the economic recovery causing the central bank not to raise rates for a very long time. This could, in turn, hurt banks more and we could see a reversal trend so it’s important to stay on top of these developments.  

Why Buy Barclays Shares with Admirals?  

✔️ Admirals is authorised and regulated by the UK Financial Conduct Authority (FCA) and other well-known financial regulators.  

✔️ Invest in real stocks and ETFs from all around the world and build a passive stream of income through dividend investing from the Invest.MT5 account!  

✔️ Enjoy a low commission of just 0.1% on UK stocks and a low minimum transaction fee of just 1 GBP! 

✔️ Access Premium Analytical tools and complimentary market updates, investment research and education.  

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Jitanchandra Solanki
Jitanchandra Solanki Financial Markets Author, Admirals London

Jitanchandra is a financial markets author with more than 15 years experience trading currencies, indices and US equities. He is an accredited Market Technician with a BA Hons degree.