Due to the recent global issue the economy has been put into deep freeze, with people spending less and INTEREST RATES at an all time low. Subsequently Bank Stocks have taken a major hammering!
Is the world about to end? Or is this the greatest time to invest in some bargain stocks (PREVIOUS VIDEO CLIP) – ON THE BEACH
If you believe like me that the economy will recover from this global issue as it has recovered from so many recessions in the past then now may be a great time to pick up some bargain stocks!
THE SALE IS ON!
Barclays is an historic British institution which traces its origins back to 1690 when John Freame, a Quaker, and Thomas Gould started trading as goldsmith bankers in Lombard Street, London.
They also launched the worlds first Cash machine in 1967. And the UK’s first debt card in 1987.
There businesses include consumer banking and payments operations around the world. They are also a global corporate and investment bank.
The recent global issue has saw it’s share price plummet by over 75% , Is the Bank doomed? Or Could this be a great turnaround investment?
IN this video I’m going to give you a full analysis of the stock and detail whether this could be a great investment opportunity.
As a little teaser I just purchased shares in the Bank!
LETS DIVE IN
Central banks around the world have unlocked trillions of dollars of funding and liquidity to make sure the financial system holds together in these tough times. So far, these actions seem to be working.
Reduced interest rates and more liquidity will make it easier for the bank to borrow and lend.
How did Barclays perform during the previous Financial Crisis?
In the previous financial crisis the Barclays share price fell to a low around 10% of tangible book value.
So Barclays is nearly as cheap as it was back in 2009, even though the risks facing the group are much lower this time around.
Although the stock price could fall much further before getting better, the stock even at current levels offers a wide margin of safety!
WARREN BUFFETT WOULD APPROVE.
If the stock returns to it’s tangible book value, investors are BANKING on a potential upside of 300%!!!
What is Barclays like compared to other Banks?
Barclays stands out as one of the cheapest shares in the FTSE 100 right now. A true value stock.
There are no other companies that offer more value on a price-to-tangible-book (P/TB) basis.
The stock’s 0.25 multiple is the cheapest in the index.
The Barclays share price is also cheaper than many of the UK’s other banks such as Lloyds and RBS.
For example, Shares in these two companies are dealing at a P/TB ratio of 0.6 and 0.4 respectively. Barclays’ ratio is just 0.25.
FINAL THOUGHTS:
Barclays are likely to suffer some further turbulence in the short term.
But over the long run I believe Barclays will continue to hold its position at the top of the UK banking industry.
Another credit for Barclays is it’s transatlantic presence gives the bank an edge over other lenders here in the UK.
Which really does deserve a premium rather than a discount over other banks.
I will leave you with a banking joke,
A local bank is introducing a cash machine built in to a tree. If it’s successful, they might expand to other branches!!
SEE YOU NEXT TIME! 😊
