Despite a “once-in-a-lifetime crisis”, Barclays has delivered “forecast-beating profits”, says Ben Marlow in The Daily Telegraph. That is due to its investment bank, which is “firing on all cylinders”. The shares rose by 7% on the news.
With boss Jes Staley pledging to “hang around for several years yet”, it looks as though activist shareholder Ed Bramson’s “hostile” campaign to get rid of Staley and move Barclays away from investment banking has been a “complete failure”.
The latest results show the benefit of having a “diversified business model” rather than narrowly focusing on retail banking.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Not so fast, says Lex in the Financial Times. Over the past year Barclays’ share price has largely been determined by the performance of the overall European banking sector, which has been hit by fears of a second lockdown. So, unless bond yields change tack and rise, pointing to “strong economic recovery”, it is “hard to see” the stock rising further.
Indeed, the “surging” investment bank may already be “running out of steam”, with sales in the last quarter 16% below the average of the two previous quarters, says Liam Proud on Breakingviews. What’s more, a few good quarters don’t make up for the “sub-par” returns that it has generated over the past few years. Over the last 19 quarters the unit actually “destroyed” value due to its low return on equity. With the board already engaged in “succession planning”, a candidate “less attached” to the markets business would be the best choice to succeed Staley.
-
RICS: Budget failed to boost property market and recovery unlikely until spring 2026Data from the Royal Institution of Chartered Surveyors suggests the Autumn Budget hasn't helped to improve property market sentiment
-
FCA launching targeted support to help savers with complex financial decisionsThe regulator wants to help you get to grips with investing and pension planning. Here’s how its new targeted support framework will help you
-
Leading European companies offer long-term growth prospectsOpinion Alexander Darwall, lead portfolio manager, European Opportunities Trust, picks three European companies where he'd put his money
-
How to harness the power of dividendsDividends went out of style in the pandemic. It’s great to see them back, says Rupert Hargreaves
-
Why Trustpilot is a stock to watch for exposure to the e-commerce marketTrustpilot has built a defensible position in one of the most critical areas of the internet: the infrastructure of trust, says Jamie Ward
-
Tetragon Financial: An exotic investment trust producing stellar returnsTetragon Financial has performed very well, but it won't appeal to most investors – there are clear reasons for the huge discount, says Rupert Hargreaves
-
How to capitalise on the pessimism around Britain's stock marketOpinion There was little in the Budget to prop up Britain's stock market, but opportunities are hiding in plain sight. Investors should take advantage while they can
-
London claims victory in the Brexit warsOpinion JPMorgan Chase's decision to build a new headquarters in London is a huge vote of confidence and a sign that the City will remain Europe's key financial hub
-
The consequences of the Autumn Budget – and what it means for the UK economyOpinion A directionless and floundering government has ducked the hard choices at the Autumn Budget, says Simon Wilson
-
Reinventing the high street – how to invest in the retailers driving the changeThe high street brands that can make shopping and leisure an enjoyable experience will thrive, says Maryam Cockar
