Citi Raises Lloyds Banking Price Target to 77 GBp, Maintains Neutral Rating

Citi has raised Lloyds Banking's price target to 77 GBp from 75 GBp and maintains a Neutral rating on the shares. The updated price target reflects the firm's expectation of stable earnings growth and a strong balance sheet. However, the analyst believes that the stock is fairly valued at current levels, leading to the Neutral rating.

Citigroup has increased its price target for Lloyds Banking Group (LON:LLOY) from 75 GBp to 77 GBp, reflecting a potential upside of 0.55% from its previous close. The updated target, released on August 1, 2025, is accompanied by a Neutral rating, indicating a cautious stance from the analysts.

The decision to raise the price target comes on the heels of Lloyds Banking Group's recent quarterly earnings, which reported an EPS of 3.80 GBp and a return on equity of 11.22%. These figures suggest a robust financial performance, contributing to Citigroup's optimistic outlook. However, the Neutral rating implies that the stock is fairly valued at current levels, with analysts advising investors to exercise caution.

Other analysts have also weighed in on Lloyds Banking Group's stock. Shore Capital maintained a Hold rating and a price target of 74 GBp, while JPMorgan Chase & Co. lifted its target price from 78 GBp to 79 GBp and assigned an Underweight rating. The stock currently has an average rating of Hold and an average price target of 69 GBp, according to MarketBeat.com.

Lloyds Banking Group's financial health reveals a mixed picture. The company reported a total revenue of 24,990.47 million GBp, with a year-over-year revenue growth of 6.1%. However, earnings growth has been less consistent, with a 10% decline over the past year. The company's net margin stands at 23.7%, while the return on equity is 9.79%. The balance sheet shows some areas of concern, particularly in terms of financial strength, with a high debt load and a low Piotroski F-Score.

Despite these challenges, Lloyds Banking Group's consistent revenue growth and strategic focus on core banking operations provide a foundation for potential long-term stability. The stock's valuation metrics suggest that it is approaching its historical highs, with a P/E ratio of 12.53 and a P/B ratio of 1.04. The Relative Strength Index (RSI) of 51.51 indicates a balanced market sentiment, while institutional ownership remains relatively low at 3.57%.

In conclusion, Citigroup's updated price target for Lloyds Banking Group reflects a cautious optimism about the company's future performance. While the stock is fairly valued at current levels, its strong financial performance and strategic focus on core banking operations make it an attractive investment option for risk-averse investors.

References:
[1] https://www.marketbeat.com/instant-alerts/citigroup-forecasts-strong-price-appreciation-for-lloyds-banking-group-lonlloy-stock-2025-08-01/
[2] https://www.gurufocus.com/news/3028326/lloyds-banking-group-lyg-price-target-increased-by-citi