Barclays sees huge upside for NatWest despite recent rally

9th May 2024 15:26

(Sharecast News) - NatWest's share-price surge since the start of the year could well continue, according to analysts at Barclays, who hiked their target price for the stock on Thursday.

Barclays reiterated its 'overweight' rating on the stock, which has gained 15% over the past month and 45% since the start of the year.

"Despite strong share-price performance (+45% YTD), we continue to see significant upside," Barclays said in a research note.

As a result of higher earnings and lower cost of equity, Barclays hiked its target price from 330p to 400p, a level not seen since 2015, compared with Wednesday's closing price of 317p.

"EPS momentum is turning positive, we are 10%+ ahead of [consensus], and with an exit of UK government firmly in sight, we expect an ongoing re-rating on strongly growing tangible net asset value," Barclays said.

NatWest shares were up 0.4% at 318.3p by 1551 BST.