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So far, 2024 has been a good year for investors. He S&P 500 has risen 8.8% since December 29, 2023, while the Nasdaq Composite is 8.9% ahead. Even the FTSE 100 has joined the party, with a rise of 7.7%. But Barclays (LSE:BARC) share price has easily outperformed these indices since the start of the year.
Barclays shares soar
At the end of 2023, Barclays shares closed at 153.78 pence. Then they began to slide, as has happened so many times before. On February 13 they closed at 140.48 pence, 8.7% less in 2024.
However, the Barclays share price has seen a big recovery since Valentine's Day. As I write, it sits at 210.05p, having risen almost half (+49.5%) since 13 February. This leaves this popular stock 36.6% higher in 2024, valuing Blue Eagle bank at £31.5 billion.
Following this recent boost, shares are up 36.8% in one year and 33.4% in five years. I am sure these numbers will be welcomed by the bank's long-suffering shareholders. Even better, they exclude cash dividends, which have risen sharply at British banks.
I wish we had bought in October
At its 52-week low on October 30, 2023, this stock fell to 128.12 pence. Back then, he knew this stock was a screaming buy. In fact, on November 2nd I wrote: “Barclays shares seem convincing value for me at this moment”.
Unfortunately, at that time I couldn't raise enough cash to back up my belief. Thus, I lost the opportunity to obtain a return of up to 64% in just over six months. Rats.
That said, my wife and I have been shareholders of Barclays since July 2022 and paid 154.5 pa per share for our stake. Year to date, we have racked up a 36% paper gain, which is pretty good when compared to a “boring” Footsie stock.
In addition, we have also been paid four cash dividends during this time, totaling 15.25p. These amount to almost a tenth (9.9%) of our initial investment and were our main motivation for owning these shares.
stocks Might Have Further Way to Go
At the current share price, Barclays shares trade at 8.2 times earnings, which is no longer “cheap” by historical standards. What's more, its dividend yield of 3.8% per annum is now below the 4% per annum cash yield of the broader FTSE 100.
In other words, I no longer consider these stocks to be incredibly cheap. On the other hand, I have no idea what might happen to the Barclays share price in the short term. It could continue to rise or retreat, who can say?
That said, analysts expect UK bank profits to fall in 2024, driven by weak credit growth and rising bad debts. And who knows, maybe things could be even worse in 2025?
Despite these concerns, I have no intention of selling this stock today because I am a long-term value investor. But if things went very badly for Barclays, he could change his mind quickly!
