With spreadsheets being revisited after the third-quarter reporting season, we are now starting to see some tweaks to the outlook for Lloyds Banking Group PLC (LSE:LLOY).
And the revisions have largely been positive for black horse lender.
The analyst team at BNP Paribas was the biggest mover in the latest flurry of notes.
It upgraded its recommendation to ‘outperform’ from ‘neutral’ while its share price target moved to 62p from 58p. UBS kept its ‘buy’ advice but nudged its valuation to 60p from 55p. Royal Bank of Canada (TSX:RY) rates Lloyds shares ‘outperform’ to 54p.
A key change common across the board was the add-back of certain provisions taken at the start of the pandemic, which positively affects per-share earnings – and, by extension, valuations. That said, at least one team expects Lloyds’ buyback programme to be larger than the market is currently anticipating.
Late morning the stock was changing hands for 51.14p, up 1.8%.
Of the 24 banks and brokers covering Lloyds, 16 rate the shares either ‘buy’ or ‘outperform’. Only one has a negative call on the stock, with the rest maintaining a ‘neutral stance’.
The average target price suggests the shares are undervalued by 13.5%. Analsysts expect pre-tax profit for 2021 to be up year-on-year by 500%, albeit from a very low base.
Read More: Analysts take a shine to the black horse lender and reckon the shares