Barclays closed 2025 with a return on tangible equity of 8.5% in Q4, exceeding its 11% target for the full year. New targets until 2028 aim for further profitability growth. The bank has stabilized by reducing risk exposure and strengthening retail and corporate banking in the UK and US, focusing on reaping the benefits of reshaping efforts.

Barclays announced 2028 targets of return on tangible equity above 14% and total shareholder distributions of at least £15 billion between 2026 and 2028. Despite a raised fair value estimate to GBX 435 per share from GBX 337, shares are considered expensive. Assumptions reflect greater capital efficiency, driving up returns through improving profitability across the group.

Morningstar Equity Research’s analysis of Barclays highlights the bank’s strategic reshaping efforts and focus on profitability improvements. The new targets until 2028 signal a strong commitment to driving shareholder value through increased return on tangible equity and capital distributions. Shares are considered expensive despite a raised fair value estimate, reflecting improved profitability assumptions.

Read more at Morningstar: Barclays Earnings: New Strategy Sends Strong Signal but Requires Strong Execution