Shares in Barclays slumped on Thursday morning after the bank posted its annual results.
The Big Four bank reported a £8.1bn pre-tax profit, up 24 per cent from 2024, surpassing analyst expectations of £8.07bn.
However, its stock dropped five per cent, as low as 290.34p after the market opened.
Still, despite the drop, Peel Hunt reiterated its Buy rating for the lender, adding the fourth quarter “was a further positive period for Barclays”.
The investment bank said: “All guidance for 2026 is unchanged, and new guidance for 2025 appears broadly consistent with consensus, which in our view is unlikely to move.”
It intends to “refresh” estimates and the 321p target price for the lender shortly.
Barclays results: ‘No real drama’
Will Howlett, financial analyst at Quilter Cheviot, said: “There were no real dramas in Barclays’ Q4 results this morning”.
He added whilst the performance was “good,” there was “nothing incremental to drive shares after a strong performance”.
“Ultimately, while there have been many false dawns with Barclays, its strategy update has changed the investment narrative for the company.
“With granular targets across divisions and a commitment to grow in higher profitability areas, Barclays is showing promising signs of progress,” he added.
Barclays’ net interest margin expanded by 46 basis points, compared to the same quarter last year.
Richard Hunter, head of markets at Interactive Investor, said: “There is little to suggest that the current market consensus of the shares as a strong buy will be troubled, despite today’s temporary share price glitch.”
The lender’s UK profits enjoyed a spike following its acquisition of Tesco Bank’s retailing business, which was completed on November 1, 2024.
A £0.6bn day one gain from the takeover had pre-tax profits up 25 per cent over the last year.
Group chief executive, C. S. Venkatakrishnan, said: “In 2024 we met our financial targets, delivering for our customers and clients, with operational and financial performance improvement driven by disciplined execution of the three-year plan.”