Barclays may surprise with its revenue

According to Jefferies analysts, Barclays may be well-positioned to report better-than-expected revenue due to increased net interest income margins and credit card revenue.

Noting Barclays' intention to add £30 billion of risk-weighted assets to its UK operations, Jefferies said in a report that "increased management attention could have important ramifications."

This follows "heightened risk aversion" following Brexit, which caused Barclaycard UK's market share to decline from 24% in 2019 to 15% in 2023.

As reported by Jefferies, the combined return on tangible equity produced by Barclays UK, UK corporate, and private & wealth management in 2022 and 2023 was 20%, making it the bank's second-largest revenue stream.

Barclaycard-driven projections from Jefferies for a stronger capital return through 2026 than those made by Barclays itself were for £10 billion compared to £11.1 billion.

Analysts continued, "Barclays' £6.1 billion UK net interest income guide for this year could be subject to some positive surprise."

"As swap rates have increased and the deposit mix change has been less apparent, near-term net interest margin performance has shown an increasing trajectory.”

As a consequence, Jefferies predicted that the amount would be £6.24 billion.

Reiterating its "buy" recommendation, Jefferies increased its target price for Barclays' shares from 330.00p to 335.00p.

(Sources: investing.com, proactiveinvestors.co.uk)