Barclays double-upgrades Virgin Money to 'overweight'

Virgin Money UK
135.80p
14:00 21/01/21
Barclays upgraded its stance on shares of Virgin Money on Wednesday to ‘overweight’ from ‘underweight’ and hiked the price target to 165p from 100p.
Banks
2,612.24
14:00 21/01/21
FTSE 250
20,894.52
14:00 21/01/21
FTSE 350
3,841.09
14:00 21/01/21
FTSE All-Share
3,815.75
14:00 21/01/21
The bank said it reckons Virgin Money is best placed to enjoy a mortgage tailwind, which it sees as sustainable from 2021, alongside asset quality better than many peers.
"We see long-term value from strong pre-provision operating profit recovery, with Virgin Money on course for double-digit returns beyond 2022," Barclays said.
"Despite the recent share price rally, we think valuation is attractive at 6.1x 2022e earnings (versus sector at 8.6x) or 0.6x TNAV for a 9.7% return on tangible equity."
At 0955 GMT, the shares were up 4.5% at 148p.