Lloyds Shares Reach 52-Week High: Is it Too Late to Buy?
Lloyds (LSE: LLOY) shares have recently reached a 52-week high of 79.19p, a significant milestone for the banking giant. According to an analysis by The Motley Fool, this is a promising sign for long-suffering shareholders, but the question remains whether the recent rally leaves any value on the table for new investors.
The share price has climbed over 40% year to date, supported by a modest improvement in investor sentiment towards UK banks, as reported by The Motley Fool. A sector-wide upgrade by analysts has also contributed to the surge. Rising interest rates have expanded net interest margins, even as economic data suggest the Bank of England may begin easing rates in the second half of 2025. In this environment, Lloyds — with its domestic focus and large retail deposit base — could emerge as a key beneficiary, notes The Motley Fool.
However, the bank’s latest Q1 results weren’t flawless, as The Motley Fool highlights. Underlying profits fell 7% to £1.52bn, with the bank putting aside £105m to prepare for a potential rise in bad loans. The decline was partly due to higher operating costs and regulatory charges. These challenges, combined with ongoing economic uncertainty, could weigh on performance in the second half of the year.
Despite the mixed earnings, Lloyds continues to return cash to shareholders in the form of dividends, reports The Motley Fool. The 2024 final dividend of 2.11p per share was paid in May, bringing the full-year yield to around 4.7% at current prices. The group also announced a £2bn share buyback earlier this year. For income-focused investors, that’s attractive, as The Motley Fool points out. While not the highest yield on the FTSE 100, it’s backed by a well-capitalised balance sheet and a CET1 ratio of 13.7%. Provided the UK avoids a severe downturn, the dividend looks sustainable.
Lloyds is also grappling with the shift to digital, recently announcing plans to close 136 branches across the UK by March 2026, as The Motley Fool notes. The bank has committed to no job losses, but the move underscores a broader transformation — and the costs associated with it. At the same time, Lloyds is investing in technology and digital services, aiming to improve efficiency and customer experience. While the upfront expense is significant, these efforts could position the bank more competitively over the long term, according to The Motley Fool.
Even after the recent rally, Lloyds shares still trade below their pre-pandemic levels, observes The Motley Fool. The stock’s valued at around 7.5 times forward earnings — an attractive valuation by historical or sector standards. That offers a margin of safety for value-oriented investors. However, growth may be modest, as a largely UK-focused bank, it lacks the international diversification of some rivals. Any setback in the UK housing market or rise in unemployment could quickly impact performance.
As The Motley Fool concludes, Lloyds shares may no longer be the deep value play they were last year, but they still look reasonably priced for long-term investors seeking income and gradual capital growth. While not without risks, the bank’s stable dividend, improving sentiment and leaner cost base make it worth considering for a diversified passive income portfolio — even near a 52-week high.
The Motley Fool’s analysis highlights that Lloyds’ valuation is attractive, and its dividend yield is backed by a solid balance sheet. As the bank continues to invest in digital transformation and navigate the challenges of the UK banking sector, investors may want to consider adding Lloyds shares to their portfolios.
In conclusion, Lloyds’ recent 52-week high may raise questions about whether it’s too late to buy, but The Motley Fool‘s analysis suggests that the bank’s shares still offer value for long-term investors. With a stable dividend, improving sentiment, and a leaner cost base, Lloyds may be worth considering for those seeking income and gradual capital growth.
Source: The Motley Fool – Lloyds shares recently hit a 52-week high: is it too late to consider buying?
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