LONDON, Jan 22, 2026, 08:55 GMT
- Lloyds shares climbed 1.8% to 103.25p in early London trading, pushing further past the £1 mark
- UBS raised its price target to 103p but maintained a neutral stance ahead of Lloyds’ results on Jan. 29
- Retail investors are now focusing on dividends, though consensus targets point to only modest gains
Lloyds Banking Group shares climbed 1.8% to 103.25 pence in early London trading Thursday, approaching the upper end of a 52-week range between 60.36p and 103.55p. At 103.25p, the stock is hovering just above the £1 mark—a psychological threshold closely watched for the UK lender.
The move comes just a week before Lloyds’ full-year results, scheduled for Jan. 29. Investors will be keenly watching for 2026 guidance and hints about what follows the 2022–26 strategic plan. UBS lifted its price target to 103p from 90p but held firm on a neutral rating, citing uncertainties around growth after 2026 and valuations following the recent rally. UBS projects Lloyds could deliver around 25% year-on-year growth in pre-provision profit by 2026—excluding motor finance remediation costs and before loan-loss charges—driven by about 8% growth in net interest income and modest cost inflation.
The numbers leave little margin for error. Nineteen analysts followed by Investing.com set an average 12-month price target at 101.11p. The stock carries an overall “Buy” rating—12 recommend buying, seven suggest holding—but that average target now sits below the current market price.
The message across the sector is becoming familiar: cut costs, digitise, and safeguard capital. Russ Mould, investment director at AJ Bell, told City AM that the Big Four, domestic, and FTSE 100 banks all share similar strategies—focusing on cost reduction, digital transformation, and sticking to core strengths to manage risk and boost returns on equity. Quilter Cheviot’s financials analyst, William Howlett, said Lloyds and HSBC “remain solid, execution-led stories with clear capital return appeal,” noting that boards will probably assess CEOs on their strategic follow-through rather than short-term market noise. City AM
That environment has sparked a wave of bullish retail chatter around the stock, which remains above £1. On Wednesday, a Seeking Alpha analysis highlighted Lloyds’ 215% total return since mid-2022 and upgraded its rating, noting that crossing back above a pound shifts the outlook.
Dividends have entered the picture. A Motley Fool UK column projects Lloyds will pay a 4.01p per share dividend in 2026. To pull in £1,000 annually before tax, an investor would need around 25,000 shares—valued at roughly £26,000 based on Thursday’s price. The author emphasized this as a calculation of income potential, not a guarantee.
The £1 mark has a bit of history behind it. Lloyds shares topped 100p earlier this month for the first time since before the global financial crisis, City AM reported, hitting a high of 101.30p and closing at 100.75p.
The rally still faces a cloud of uncertainty: the cost of redress from the UK motor finance scandal. In October, Lloyds set aside provisions totaling £1.95 billion, including an additional £800 million charge. It also lowered its guidance for return on tangible equity — a key profitability metric excluding intangibles — to about 12%. CEO Charlie Nunn said then, “Strong capital generation was supported by income growth, cost discipline and strong asset quality.” The bank plans to challenge the regulator’s approach, so the final cost remains unclear. Reuters
Lloyds is currently trading near—and in some data sets even above—the average analyst target. The next key event will be the update on Jan. 29. Investors want to hear the bank’s take on earnings sustainability, capital returns, and whether the push above £1 can hold up once the headlines settle.
