Bank Of America Says Barclays Shares Are Cheap Enough To Buy

Barclays PLC (ADR) BCS shares have underperformed the EU bank sector by 29 percent in 2017, with the stock stuck below $10.

The underperformance has prompted Bank of America Merrill Lynch to upgrade the shares of Barclays by two notches.

The Analyst

BofA Merrill Lynch analyst Michael Helsby upgraded shares of Barclays from Underperform to Buy.

The Thesis

The reflation exuberance of the second half of 2016 reversed in 2017, with the bank's investment banking business suffering from low volatility and some self-imposed mishaps, Helbsy said in a Monday note. (See Helbsy's track record here.) 

The analyst said he believes the British bank's low earnings expectations and depressed share price make for a buying opportunity. 

The Price Action

Barclays shares are down over 9 percent year-to-date. The stock closed Monday's session at $9.97, up 2.15 percent.

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