Is the Barclays Share Price Rally Coming to an End?

Barclays (LON: BARC) shares have rallied significantly over the last year or so, but according to analysts at Citi, the uptrend may come under pressure. 

Citi downgraded Barclays from Buy to Neutral in a recent note, citing limited upside after the sharp rally. 

The stock is up 30.7% so far in 2025 and over 55% in the last 12 months ahead of the bank’s half-year results on July 29.

“Following the rally in the shares, we believe the risk-reward is now more evenly balanced,” said Citi.

The analysts now see a more balanced risk-reward profile and “struggle to identify near-term positive catalysts for the stock to re-rate further.”

The firm maintained a price target of 366p, slightly up from the previous 360p. For the second quarter, Citi forecasts adjusted pre-tax profit of £2.3 billion, 1% below consensus, with broadly in-line revenue, 2% lower costs, and 14% higher impairments, mainly linked to the U.S. consumer business.

By division, Citi is above consensus on Investment Bank profit (+3%), in line on UK operations, but significantly below expectations on US Consumer (-44%). 

The analysts also expect Barclays to report a common equity tier 1 (CET1) ratio of 13.6%, down 30 basis points quarter-on-quarter and 40bps below consensus, due to a full deduction for the newly announced £1 billion share buyback.

A second-quarter dividend of 3.2p is projected, in line with market estimates. Citi expects Barclays to reiterate all existing 2025 and 2026 financial targets.