Lloyds Share Price Forecast Ahead of Q2 and H1 Earnings

The Lloyds share price will be in the spotlight this week as investors wait for the company’s half-year earnings scheduled for Thursday. The stock ended last week at 45.88p, which was about 7% above the lowest level on Monday. 

Lloyds earnings. Lloyds Bank will be among the several FTSE 100 companies that will publish their results this week. Other top firms will be NatWest, British American Tobacco, BT, BP, and Royal Dutch Shell.

In general, business conditions were highly favourable for Lloyds in the first half of the year. For one, the UK managed to ink a deal with the European Union, which prevented a catastrophic meltdown of the UK economy. 

Further, the housing market did well as demand pushed prices to the highest level on record. This demand was due to low-interest rates and the stamp duty waiver. As a result, Lloyds Bank benefited because of its pivotal role in the UK housing sector.

Meanwhile, consumer spending rebounded as the UK economy reopened. This helped the bank in terms of credit card spending and the overall purchases by both consumers and businesses. Most importantly, the Bank of England (BOE) gave banks permission to pay dividends and buy back shares. All this benefited the Lloyds share price, which has risen by more than 40% year-to-date.

Therefore, analysts expect that the bank’s revenue and income grew in the first half of the year. The latest consensus is that the firm’s revenue dropped from 7.4 billion pounds in the first half of 2020 to more than 7.35 billion pounds in the first half of the year. They also see the second-quarter revenue rising from 3.4 billion to more than 3.6 billion. In total, the half-year profit is expected to rise from 19 million pounds to 3.29 billion pounds, as shown below.

Lloyds Bank estimates

Lloyds share price forecast

The four-hour chart shows that the LLOY share price staged a strong recovery last week after it crashed sharply. The stock is now trading slightly below the upper line of the descending channel. Also, it remains at the same level as the 25-day and 50-day moving averages. The Relative Strength Index (RSI) has also moved to the neutral level of 52. 

Therefore, while the firm is expected to publish strong results, we can’t rule out a situation where its share price retreats to the lower side of the channel at around 42p before and after earnings. Indeed, shares of most American banks like Goldman Sachs and Morgan Stanley declined even after strong results.

Don’t miss a beat! Follow us on Telegram and Twitter.

LLOY share price chart

Lloyds share price

Follow Crispus on Twitter.