What You Were Buying Last Week: Barclays PLC (ADR) (BCS)

Of course, the discount may also be because the market is pricing in perceived risks to Barclay’s growth. But a return to profit was announced in its Q1 results earlier this year, with pre-tax profit up to £1,535 million from a £525 million loss in Q1 2012. Analyst forecasts are for significant earnings-per-share growth over the next two years — 688% in 2013 (34.3 pence, compared with 2012’s 4.36 pence) followed by a more modest 25% in 2014 (42.8 pence). And Barclay’s forward P/E of under 9 also makes it seem like a better value than its main rivals — theirs are all well into double-digits, with Royal Bank of Scotland Group plc (ADR) (NYSE:RBS)’s almost double that of Barclays PLC (ADR) (NYSE:BCS). So those risks may not be as great as current market sentiment would have you believe.

There’s also Barclay’s dividend. Under 2% last year, it’s expected to rise by around 20%, to 2.4%, in 2013, and by a further 36%, to around 3.2%, in 2014. Whilst that would still leave it below the current FTSE 100 average yield of 3.6%, it’d be a pleasant bonus on top of any capital growth.

But of course, no matter what other people were doing last week, only you can decide if Barclays PLC (ADR) (NYSE:BCS) really is a buy right now.

The article What You Were Buying Last Week: Barclays originally appeared on Fool.com and is written by Jon Wallis.

Jon doesn’t own shares in any of the companies mentioned in this article. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

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