Breaking News
Get 40% Off 0
Is NVDA a 🟢 buy or 🔴 sell? Unlock Now

Lloyds price target slashed but still a 'buy' says Jefferies

Published Dec 07, 2023 13:04 Updated Dec 07, 2023 13:10
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Lloyds price target slashed but still a 'buy' says Jefferies
 
LLOY
-0.95%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

Proactive Investors - Lloyds Banking Group PLC (LON:LLOY) slipped 1.0% after broker Jefferies cut earnings estimates and slashed its price target for the UK’s largest mortgage lender.

The broker has made material cuts to net interest income forecasst on expectations for lower net interest margin (NIM), higher deposit churn and lower base rate benefits with the favourable tailwind from structural hedge income not set to be a full offset until the third quarter of 2024.

It expects NIM to trough in the first quarter of 2024 at 301 basis points.

But while the bank has cut 2023-25 earnings by an average of 10%, it maintains forecasts for £7.5 billion of cumulative buybacks over this period.

It is the scale of the share buy-backs – around 26% of the bank’s market value – and 14-15% return on total equity sustains value creation, in Jefferies view.

But given recent industry trends and the company’s own experience, notably in the third quarter, the broker has cut its NIM forecasts by 4bps for 2023 and 26bps for 2024, followed by 12bps in 2025.

Jefferies keeps a ‘buy’ rating on Lloyds but has slashed its price target to 62p from 80p.

Read more on Proactive Investors UK

Disclaimer

Lloyds price target slashed but still a 'buy' says Jefferies
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email