Barclays Soars 2.01% on Restructuring Plan, Citi Upgrade

Barclays' stock price surged to its highest level since January 2014 today, with an intraday gain of 2.01%.

The strategy of buying Barclays Bank (BCS) shares after they reached a recent high and holding for 1 week yielded moderate returns over the past 5 years. Here is the backtest performance:

Annualized Return: The strategy generated a 4.5% annualized gain, indicating a stable return over the period.

Total Return: Over the past 5 years, the strategy delivered a total increase of 11.91%. This suggests that the strategy captured some of the subsequent price appreciation following the high point.

Sharpe Ratio: With a Sharpe ratio of 0.6, the risk-adjusted returns were modest. This indicates that while the strategy had some positive returns, the risk-adjusted performance was not exceptionally high.

Drawdown: The maximum drawdown during the 2020 COVID crash was -7.2%, which highlights the strategy's downside risk. This is a consideration for investors who may be sensitive to volatility and potential losses.

In conclusion, while the strategy showed some positive returns, the modest Sharpe ratio and the significant drawdown during the COVID crash suggest that it may not be the most optimal strategy for all market conditions. Investors should weigh the potential returns against the risks and consider their own risk tolerance and investment horizon when deciding on a strategy.

Barclays is currently undergoing a significant restructuring plan aimed at reducing costs and focusing on its core business units. The bank has set a target of achieving €2 billion in gross savings by 2026, which is expected to enhance its long-term profitability. This strategic initiative has been well-received by investors, who see it as a positive step towards improving the bank's financial health.

On June 4, 2025, Citi upgraded its price target for Barclays from 345 GBp to 360 GBp, while maintaining a Buy rating. This upgrade is a reflection of the bank's strong performance in the first quarter of the year, which has likely contributed to the positive investor sentiment surrounding the stock.

Additionally, Barclays made a strategic adjustment to its stake in Vodafone Group, increasing it to 5.11% on May 30, 2025. This move is seen as a significant investment decision that could influence how investors perceive Barclays' market strategy and future growth prospects.