Nomura Securities Upgrades Barclays to “Buy” (BCS)

Nomura Securities reported that it has upgraded financial services company Barclays PLC (BCS) to “Buy.”

The firm has lifted its rating on BCS two notches from “Reduce” to “Buy.” Normura has also raised its price target from 260p to 340p.

Analyst Chintan Joshi commented: “With growth in the developed world likely to continue well into the start of next year, stocks geared to capital markets should see macroeconomic support. Structural issues are an industry feature and Barclays could still come out better relative to peers compared with its current position. We expect 2015 ROTE of c12% and believe Barclays should be valued at a 2014E P/TB of 1x as we look for 1Q14 momentum. We set our ex-rights target price at 340p (cum rights it would be 380p), which puts the stock at a 2015E P/E of 6.4x, which is hardly demanding. Barclays is now our top pick among its IB and UK peers and a preferred way to gain exposure to the current risk rally. We upgrade our rating on Barclays to Buy from Reduce. We believe investors waiting for the infamous J curve may find that it is fairly muted for Barclays on the downside.”

Barclays shares were up 27 cents, or 1.40%, during pre-market trading Monday. The stock is up 11% YTD.