With shares of Barclays (NYSE:BCS) trading around $17, is BCS an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework.
T = Trends for a Stock’s Movement
Barclays is a global financial services provider engaged in retail banking, credit cards, wholesale banking, investment banking, wealth management, and investment management services. The company operates in eight segments: U.K. Retail and Business Banking, Europe Retail and Business Banking, Africa Retail and Business Banking, Barclaycard, Barclays Investment Bank, Barclays Corporate Banking, Wealth and Investment Management, and Head Office and Other Operations. Banking and capital markets services are just about a requirement for most consumers and companies around the world.
Barclays recently reported earnings, with the British bank’s profit rising to 728 million pounds ($1.2 billion) versus a loss of 13 million pounds a year ago. Barclays was still hurt by its slumping fixed-income business, which caused the income from its investment bank to fall. Barclays is also facing an investigation by British regulators for possibly fixing foreign exchange markets. Several other European banks including UBS (NYSE:UBS), which reported earnings on Tuesday, are facing investigations related to the possibility that they may have manipulated foreign currency markets.
T = Technicals on the Stock Chart Are Weak
Barclays stock has been in a range over the past couple of years. The stock is currently trading sideways and looks set to continue. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Barclays is trading below its rising key averages, which signals neutral to bearish price action in the near-term.
Source: Thinkorswim
