Ahead of Barclays's full-year results due on February 12th, UBS has raised its target price for the stock from 315p to 325p and kept its 'neutral' rating.

The broker expects Barclays to report a full-year profit before tax (PBT) of £6,909m for 2012, slightly above the consensus estimate of £6,856m. due to improved cost efficiency.

"However, we think the better operating backdrop for market activity will feed through to Barclays estimates this year and we have lifted our group estimates for 2013 by 5.0% to reflect this," UBS said.

As for Barclays's fourth quarter, the broker said that it will likely recognise an own-credit charge as credit spreads fell sharply. However, this is not expected to affect the bank's estimated core tier-one capital ratio of 11.3%

Following on from the £700m charge for Payment Protection Insurance (PPI) redress seen in the third quarter, UBS said that PPI compensation will likely be an "ongoing issue" for UK banks with further provisioning likely.

To accompany the group's results, results of a strategic review are expected. Regarding this, UBS said: "While there have been press reports of redundancies in parts of Barclays' investment bank in recent days, these have been concentrated in relatively peripheral parts of the business where the group has little hope of attaining market leadership.

"We do not expect a radical downsizing of Barclays strong FICC business or in European equities where substantial investment has been made and is at the centre of the groups core operations."

Shares were down 1.59% at 301p by 10:34 on Tuesday.

BC

Related share prices
Barclays (BARC) share price