Wednesday, April 20, 2016

Barclays PLC ADR

Sound bite for Twitter and StockTwits is: Stock probably relatively cheap. This bank seems to have had a hard time recovering from 2008. See my spreadsheet on Barclays PLC ADR.

I own this stock of Barclays PLC ADR (LSE-BARC, NYSE:-BCS). I bought this stock when Barrett took over in 2000. Barrett used to run Bank of Montreal in Canada. At that time it was a good dividend paying stock and I thought it would give me some geographical diversifications.

The first thing I should mention about dividends is that this UK company pays dividends differently that Canadian and US companies do. At the end of each year, depending on how well the bank does, the bank declares a dividend to be paid in the first quarter of the following year. For the remaining three quarters, a nominal dividend is paid.

For Barclays in the past year, £0.035 was paid in the first quarter and £0.01 was paid in the following quarters. The dividends have been flat year after year since 2012. Prior to that there was a 97% decline in dividends in 2009. Then in 2010, dividends increased by 350%. There were also increases in 2011 and 2012. Still, the current dividends are 81% lower in 2015 than they were in 2008.

The last few years have not been kind to this bank. I look at my spreadsheet and there is lots of red. They have earning losses in 2012, 2014 and 2015. Analysts expect positive earnings for 2016, but they also thought there would be positive earnings in 2015 and this did not happen.

I get historical low, median and high median Price/Earnings per Share Ratios of 8.14, 9.98 and 12.51. Since there have been a number of earnings losses lately, I can get no good figures for the last 5 and 10 years in regards to P/E Ratios. The current P/E Ratio is 19.65 based on a stock price of $9.89 and 2016 EPS estimate of £0.089 or $0.50 US$. This stock price testing would suggest that the stock price is relatively expensive.

I get a Graham Price of $14.73. The 10 years low, median and high median Price/Graham Price Ratios are 0.59, 0.74 and 0.89. The current P/GP Ratio is 0.67. This stock price testing suggests that the stock price is relatively reasonable and below the median. The historical median P/GP Ratio is 1.05 which is a more reasonable one. The P/GP Ratios have been quite low lately. If you do the testing based on the historical P/GP Ratio, that the stock price is relatively cheap.

The historical median dividend yield is 3.16%. The current dividend yield is 3.74% based on a stock price of $9.89 and dividend of $0.39. The stock price testing suggests that the stock price is reasonable and below the median. (If I use dividends and stock price in UK pounds, you get the same results.)

I get a 10 year Price/Book Value per Share Ratio of 0.67. The historical median P/B Ratio is more reasonable at 1.82. The current P/B Ratio is 0.47. This testing suggests that the stock price is relatively cheap.

When I look at analysts' recommendations I find Strong Buy, Buy, Hold and Underperform recommendations. There are more Hold recommendations, but there is also almost as many Strong Buy recommendations. The consensus recommendation is a Buy. The 12 months Stock price is £2.16 or $12.28 US$. This implies a total return of 27.9% with 3.74% from dividends and 24.17% from capital gains.

This recent article in American Banking News talks about a director buying shares in this bank. Royston Wild of Motley Fool thinks now is a good time to buy this stock. John Burford does a technical analysis of this stock on Interactive Investor.

I will have only one entry for this stock this year. However, I did a more complete report on this company in 2015 and you can see that report here or here.

On my other blog, the last item I wrote about was Investment Report Cheap... learn more . The next stock I will write about will be Pembina Pipelines Corp. (TSX-PPL, NYSE-PBA)... learn more on Friday, April 22, 2016 around 5 pm.

One of the largest financial services groups in the United Kingdom, Barclays is engaged in banking, investment banking and asset management worldwide. Its web site is here Barclays PLC ADR.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk . The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits.

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