Jefferies' analysts suggest that large-scale share buy backs of about $4.7 billion over the next three years could help push up the global lender's stock price.
Shares of global bank Barclays are forecast to more than double over the next 12 months, according to Jefferies. The equity analysts at the investment bank expect shares of Barclays to rise to £3.20 — or 107% — from its current share price of £1.54. The London-headquartered bank's stock also trades in the United States and is currently priced at $7.93. Why is Jefferies bullish? The British bank's stock has underperformed and is valued below its peers over the past few months.
line Another aspect driving this positive outlook is Barclays' "structural hedge," according to Jefferies. Simply put, this is a method of managing the risk that comes with changes in interest rates. The bank has set aside a significant amount of money as a hedge, some of which will mature in 2023 and can be reinvested at higher market rates, according to Jefferies. The analysts said this move is expected to generate an extra £1.5 billion in income next year.
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