I do not 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.
When I was updating my spreadsheet, I noticed if I have kept my shares, I would have currently done slightly better than how I did. I bought shares in 2000 and sold them in 2017. I had a total return of 1.25% per year with a capital loss of 4.92% per year. If I had kept the shares, I would have had a loss of 3.89% per year to date. At this point it would seem I did the right thing to sell in 2017.
The dividend yields are currently low with dividend growth varying a lot. The current dividend yield is low (below 2%) at just 0.53%. The 5, 10 and historical dividend yields are moderate (2% to 4% ranges) at 2.46%, 2.47% and 3.25%. Of 27 years of data I have, dividends were increased 20 times and decreased 4 times (and were flat the other years). The dividends were suspended for the year of 2020. They have been restarted in 2021.
The Dividend Payout Ratios (DPR) are fine. Since no dividends were paid in 2020 there is no DPR for EPS for 2020. However, the 5 year coverage is at 59%. The 5 year coverage for DPR for CFPS in 2020 is 3.6%. For DPR for 2020 for Free Cash Flow, Barclays posts the dividend granted in one year, but paid in the next. So, the DPR for FCF for 2020 is 10% with 5 year coverage at 18%.
Debt Ratios are fine. Because this is a bank, I am looking at a Long Term Debt/Covering Assets Ratio. The ratio for 2020 is good at 0.76. Because it is a bank, Liquidity Ratio is not important and I did not calculate one. The Debt Ratio is 1.05 and this is fine for a bank.
The Total Return per year is shown below for years of 5 to 27 to the end of 2020 in UK Pounds. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2015 | 5 | 0.00% | -5.85% | -7.85% | 2.00% |
| 2010 | 10 | 0.00% | -3.17% | -5.62% | 2.45% |
| 2005 | 15 | 0.00% | -6.44% | -9.08% | 2.65% |
| 2000 | 20 | 0.00% | -2.11% | -6.15% | 4.04% |
| 1995 | 25 | 0.00% | 7.97% | -0.60% | 8.58% |
| 1993 | 27 | 0.00% | 8.58% | -0.01% | 8.58% |
The Total Return per year is shown below for years of 5 to 27 to the end of 2020 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2015 | 5 | 0.00% | -7.40% | -9.22% | 1.82% |
| 2010 | 10 | 0.00% | -4.61% | -7.01% | 2.40% |
| 2005 | 15 | 0.00% | -7.84% | -10.48% | 2.65% |
| 2000 | 20 | 0.00% | -2.24% | -6.73% | 4.49% |
| 1995 | 25 | 0.00% | 7.57% | -1.38% | 8.95% |
| 1993 | 27 | 0.00% | 9.27% | -0.32% | 9.59% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are 8.88, 14.48 and 20.78. The corresponding 10 year ratios are 6.95, 10.68 and 14.06. The corresponding historical ratios are 8.38, 10.51 and 13.00. The current P/E Ratio is 11.17 based on a stock price of $10.50 and EPS estimate for 2021 of $0.94. The current ratio is between the median and high median 10 year ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$. In UK Pounds the results suggest that the stock price is reasonable and below the median. Problem is years of EPS losses.
I get a Graham Price of $19.18 US$. The 10 year low, median, and high median Price/Graham Price Ratios are 0.53, 0.72 and 0.85. The current P/GP Ratios is 0.55 based on a stock price of $10.50. The current ratio is between the low median and median ratios of 0.53 and 0.72. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$. You get a similar result in UK Pounds.
I get a 10 year median Price/Book Value per Share Ratio of 0.59. The current P/B Ratio is 61 based on a stock price of $10.50, Book Value of $74,659M, Book Value per Share of $17.18. The current ratio is 4.3% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$. You get a similar result in UK Pounds.
I get a 10 year median Price/Cash Flow per Share Ratio of 0.47. The current P/CF Ratio is 0.57 based on a stock price of $10.50, Cash Flow per Share for last 12 months of $18.31 and Cash Flow of $79,466M. The current ratio is 23% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$. In UK Pounds the results suggest that the stock price is reasonable but above the median. This is using CFPS of last 12 months as no estimates are given.
I get an historical median dividend yield of 2.84%. The current dividend yield is 0.53% based on dividends of $0.06. The current dividend is 84% below the historical dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$. In UK Pounds you get a similar result. Problem here is dividend cuts.
I get a 10 year median dividend yield of 2.40%. The current dividend yield is 0.53% based on dividends of $0.06. The current dividend is 78% below the 10 year dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$. In UK Pounds you get a similar result. Problem here is dividend cuts.
The 10 year median Price/Sales (Revenue) Ratio is 1.50. The current P/S Ratio is 1.58 based on Revenue estimate of $28,760M, Revenue per Share of $6.68 and a stock price of $10.50. The current ratio is 5.5% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$. You get a similar result in UK Pounds.
Results of stock price testing is that the stock price is probably reasonable, if a bit high. This is showing up in the P/S Ratio test. There are problems in the tests due to declining dividends and EPS losses. Even though the stock price is lower than it has been for quite a few years, there is little to point to a current cheap price.
Is it a good company at a reasonable price? The price might be reasonable if a bit high considering the risk of investing. This bank seems to be the best UK bank. However, long term shareholders have mostly lost big on this bank. I would not be interested at this point in having shares in this bank.
When I look at analysts’ recommendations, I find Strong Buy (11), Buy (5) and Hold (7). The consensus would be a Buy. The 12 month stock price consensus is $11.27 (203.96 GBX). This implies a total return of $7.90% with 7.37% from capital gains and 0.53% from dividends.
The most recent analyst says on Stock Chase that Barclay’s is a weak buy. Manika Premsingh on Motley Fool, UK says this bank has recovered better than other UK banks. She thinks the stock price is being held back by the low dividend yield. The executive summary on Simply Wall Street, UK gives this stock 4 stars out of 5 and only one risk. A writer on Simply Wall Street says there is insider selling. Lucy White of the Daily Mail has an article in the This is Money Co, UK.
Barclays PLC operates in commercial and investment banking, insurance, financial and other related services. Barclay’s subsidiary, Barclays Bank PLC maintains 2500 branches in the United Kingdom and 1000 branches in over 75 other countries. Its web site is here Barclays PLC ADR.
The last stock I wrote about was about was Canadian Natural Resources (TSX-CNQ, NYSE-CNQ) ... learn more. The next stock I will write about will be SNC-Lavalin Group Inc (TSX-SNC, OTC-SNCAF) ... learn more on Wednesday, April 28, 2021 around 5 pm. Tomorrow on my other blog I will write about Money Sense Roundup.... learn more on Tuesday, April 27, 2021 around 5 pm.
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