Upside case
Bull case
$28+418.7%
LYG would need investors to value it at roughly 68x earnings — about 55x more generous than today's 13x forward P/E. That requires meaningful multiple expansion on top of continued earnings growth.
Analysis OverviewBuyUpdated May 1, 2026
Lloyds Banking Group plc (LYG) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Buy
Covering
24
analysts
14 bullish · 2 bearish · 24 covering LYG
Strong Buy
0
Buy
14
Hold
8
Sell
2
Strong Sell
0
Consensus Target
$3
-49.4% vs today
Scenario Range
$3 – $28
Model bear to bull value window
Coverage
24
Published analyst ratings
Valuation Context
13.0x
Forward P/E · Market cap $79.6B
LYG price targets
Three scenarios for where LYG stock could go
Current
~$5
Confidence
42 / 100
Updated
May 1, 2026
Where we are now
Current · $5
Bear
$3
Base
$13
Bull
$28
Market caseClosest to today
Base case
$13+141.0%
At 31x on FY1 earnings, the base case reflects a reasonable but not stretched valuation. It prices in continued growth without assuming an exceptional setup.
Stress case
Bear case
$3-36.8%
If investor confidence fades or macro conditions deteriorate, a 5x multiple contraction could push LYG down roughly 37% from where it trades now.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
Lloyds Banking Group plc
LYG · NYSEFinancial ServicesBanks - RegionalDecember year-end
Lloyds Banking Group is a UK-focused retail and commercial bank operating through three main brands — Lloyds Bank, Halifax, and Bank of Scotland. It generates revenue primarily from net interest income on mortgages and loans (~70%) and fees from insurance, wealth management, and transaction banking services. Its key advantage is its massive UK retail banking footprint — the largest branch network and current account market share — creating a stable, low-cost deposit base.
Market Cap
$79.6B
Net Income TTM
$4.7B
LYG Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
75%Exceptional
12 quarters tracked
Revenue Beat Rate
58%Exceptional
vs consensus estimates
Avg EPS Surprise
+8.0%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q3 2025
Q4 2025
Q1 2026
Q2 2026
Last 4 Quarters
EPS beats: 3 of 4Q3 2025
EPS
$0.14/$0.10
Revenue
$18.9B/$6.7B
Q4 2025
EPS
$0.05/$0.12
Revenue
-$5.8B/$6.8B
Q1 2026
EPS
$0.12/$0.11
Revenue
$6.5B/$6.5B
Q2 2026
EPS
$0.13/$0.11
Revenue
$6.5B/$6.6B
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q3 2025 | $0.14/$0.10 | +40.0% | $18.9B/$6.7B | +180.6% |
| Q4 2025 | $0.05/$0.12 | -58.3% | -$5.8B/$6.8B | -185.5% |
| Q1 2026 | $0.12/$0.11 | +9.1% | $6.5B/$6.5B | +0.1% |
| Q2 2026 | $0.13/$0.11 | +18.2% | $6.5B/$6.6B | -2.2% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$72.3B
+11.2% YoY
FY2
$89.8B
+24.2% YoY
EPS Outlook
FY1
$0.71
+127.2% YoY
FY2
$0.88
+24.9% YoY
Trailing FCF (TTM)$0
Next Earnings
—
Expected EPS
—
Expected Revenue
—
LYG beat EPS estimates in 3 of 4 tracked quarters. A strong delivery record supports forward estimate credibility.
LYG Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Overvalued
Fair value est. $4 — implies -21.9% from today's price.
Premium to Fair Value
21.9%
above fair value
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
LYG
14.8x
vs
S&P 500
25.2x
41% discount
vs Financial Services Trailing P/E
LYG
14.8x
vs
Financial Services
13.4x
+11% premium
vs LYG 5Y Avg P/E
Today
14.8x
vs
5Y Average
11.6x
+28% premium
Forward PE
13.0x
S&P 500
19.1x
-32%
Financial Services
10.5x
+24%
5Y Avg
—
—
Trailing PE
14.8x
S&P 500
25.2x
-41%
Financial Services
13.4x
+11%
5Y Avg
11.6x
+28%
PEG Ratio
0.36x
S&P 500
1.75x
-79%
Financial Services
1.03x
-65%
5Y Avg
—
—
EV/EBITDA
14.6x
S&P 500
15.3x
-4%
Financial Services
11.4x
+28%
5Y Avg
8.4x
+74%
Price/FCF
—
S&P 500
21.3x
—
Financial Services
10.6x
—
5Y Avg
14.9x
—
Price/Sales
0.9x
S&P 500
3.1x
-71%
Financial Services
2.3x
-60%
5Y Avg
1.6x
-42%
Dividend Yield
3.27%
S&P 500
1.88%
+74%
Financial Services
2.68%
+22%
5Y Avg
3.57%
-8%
| Metric | LYG | S&P 500 | Financial Services | 5Y Avg LYG |
|---|---|---|---|---|
| Forward PE | 13.0x | 19.1x-32% | 10.5x+24% | — |
| Trailing PE | 14.8x | 25.2x-41% | 13.4x+11% | 11.6x+28% |
| PEG Ratio | 0.36x | 1.75x-79% | 1.03x-65% | — |
| EV/EBITDA | 14.6x | 15.3x | 11.4x+28% | 8.4x+74% |
| Price/FCF | — | 21.3x | 10.6x | 14.9x |
| Price/Sales | 0.9x | 3.1x-71% | 2.3x-60% | 1.6x-42% |
| Dividend Yield | 3.27% | 1.88% | 2.68% | 3.57% |
LYG trades above S&P 500 benchmarks on 0 of 5 measured multiples — appears modestly priced relative to the S&P 500 on most measures.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolLYG Financial Health
Verdict
Stressed
LYG generates 9.9% ROE and 0.5% return on assets — the two primary signals for banking profitability. FCF-based metrics are not applicable to financial companies.
Earnings Engine
Revenue, profitability, and return on capital
Revenue (TTM)
Trailing-twelve-month sales base
—
Revenue Growth
TTM vs prior year
—
Operating Margin
Operating income divided by revenue
—
Net Margin
Net income divided by revenue
—
EPS (TTM)
Diluted earnings per share, trailing twelve months
$0.31
ROE
Return on equity — the primary profitability signal for banks
9.9%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
3.6%
ROA
Return on assets, trailing twelve months
0.5%
Cash & Equivalents
Liquid assets on the balance sheet
$56.7B
Net Debt
Total debt minus cash
$38.5B
FCF Analysis
Traditional FCF and debt/FCF ratios are not meaningful for financial companies. Focus on ROE and ROA above.
ROE
Return on equity — the headline bank profitability metric
9.9%
Shareholder Returns
How capital is returned to owners
Total shareholder yield
6.1%
Dividend
3.3%
Buyback
2.9%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$1.7B
Dividend / Share
Annualized trailing dividend per share
$0.13
Payout Ratio
Share of earnings distributed as dividends
42.0%
Shares Outstanding
Declining as buybacks retire shares
14.6B
All figures from the trailing twelve months. For financial companies, ROE and ROA are the primary health signals — FCF-based metrics are not applicable.
Open full ratios pageLYG Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 11, 2026
High Risk
UK Economic Conditions
Lloyds’ profitability is tightly linked to the UK economy, which is currently experiencing low growth, potential inflation, and global shocks. Weak conditions can reduce loan repayments, increase insolvencies, and lower collateral values, directly eroding the bank’s earnings and loan portfolio quality.
Medium
Interest Rate Sensitivity
The bank’s net interest margin benefits from rising rates but also exposes it to higher mortgage servicing costs and borrower default risk. Conversely, stagnant or falling rates compress margins, limiting profitability upside.
Medium
Data Breaches & App Glitches
Recent operational incidents, including data breaches and banking app glitches, have eroded customer trust and attracted regulatory scrutiny, creating reputational and compliance risks that could lead to fines or remediation costs.
Medium
Motor Finance Provisions
Lloyds has set aside significant provisions for potential mis‑selling of car loans, reflecting ongoing uncertainty and possible future write‑downs that could impact earnings.
Medium
Funding Costs
Increases in the cost of retail deposit funding can squeeze the group’s margins and profitability, especially if deposit rates rise faster than interest income.
Medium
Regulatory Scrutiny
The banking sector faces ongoing regulatory oversight, which can result in higher compliance costs and potential penalties, affecting the bank’s operating expenses and capital allocation.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why LYG Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 11, 2026
Strong Earnings & Margin Growth
Lloyds reported earnings per share of $0.12, surpassing analyst expectations, and maintains a solid net margin of 24.30%, indicating effective cost control and profitability.
Attractive Valuation vs Peers
The stock trades at a P/E of 14x, below the peer average of 17.5x and the estimated fair P/E of 19.9x, positioning it as a value play in the financial sector.
Robust Revenue & EPS Growth Outlook
Projected revenue growth is 13.39% this year and 7.12% next year, while EPS is expected to rise 44.68% this year and 18.27% next year, underscoring strong earnings momentum.
Share Buyback Program Enhancing Value
Lloyds continues its share buyback program, repurchasing millions of ordinary shares for cancellation, which reduces the share count and can lift earnings per share.
Positive Technical Indicators
Short- and long-term moving averages and the MACD are generating buy signals, suggesting favorable short-term price momentum for the stock.
Long-Term Growth Potential to 2030
Forecasts project the share price to reach $13.28 by the end of 2030, reflecting a significant upside from current levels and supporting a long-term investment thesis.
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
LYG Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$5.44
52W Range Position
64%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$3.81
+42.8% from the low
52-Week High
$6.34
-14.2% from the high
1 Month
+3.82%
3 Month
-7.95%
YTD
+0.9%
1 Year
+41.7%
3Y CAGR
+33.0%
5Y CAGR
+16.2%
10Y CAGR
+3.6%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
LYG vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
13.0x
vs 11.0x median
+18% above peer median
Revenue Growth
+11.2%
vs -13.8% median
+181% above peer median
Net Margin
—
vs — median
Peer median unavailable
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
LYG LYG Lloyds Banking Group plc | $79.6B | 13.0x | +11.2% | — | Buy | -49.4% |
BCS BCS Barclays PLC | $82.4B | 11.2x | -22.8% | — | Buy | +83.2% |
NWG NWG NatWest Group plc | $31.1B | 10.7x | -3.0% | — | Buy | — |
HSB HSBC HSBC Holdings plc | $314.1B | 11.0x | -4.9% | — | Hold | -43.1% |
UBS UBS UBS Group AG | $140.3B | 13.8x | -19.3% | — | Buy | -47.9% |
DB DB Deutsche Bank AG | $61.3B | 9.5x | -13.8% | — | Hold | -53.6% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
LYG Dividend and Capital Return
LYG returns 6.1% total yield, led by a 3.27% dividend. Buybacks add another 2.9%.
Dividend SustainableFCF Unknown
Total Shareholder Yield
6.1%
Dividend + buyback return per year
Buyback Yield
2.9%
Dividend Yield
3.27%
Payout Ratio
42.0%
How LYG Splits Its Return
Div 3.27%
Buyback 2.9%
Dividend 3.27%Buybacks 2.9%
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$0.13
Growth Streak
Consecutive years of dividend increases
4Y
3Y Div CAGR
18.5%
5Y Div CAGR
11.0%
Ex-Dividend Date
—
Payment Cadence
Semi-Annual
2 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$1.7B
Estimated Shares Retired
307M
Approx. Share Reduction
2.1%
Shares Outstanding
Current diluted share count from the screening snapshot
14.6B
At 2.1%/year, buybacks mechanically lift EPS even with flat earnings — each remaining share represents a slightly larger piece of the company.
| Year | Div / Share | YoY Grw | BB Yield | Total Yield |
|---|---|---|---|---|
| 2026 | $0.13 | — | — | — |
| 2025 | $0.18 | +21.3% | 2.1% | 4.6% |
| 2024 | $0.15 | +18.6% | 4.7% | 10.1% |
| 2023 | $0.12 | +15.8% | 5.1% | 9.3% |
| 2022 | $0.11 | +50.9% | 5.3% | 9.1% |
FAQ
7 questionsLYG Investor Questions
Common questions answered from live analyst data and company financials.
01Is Lloyds Banking Group plc (LYG) stock a buy or sell in 2026?
Lloyds Banking Group plc (LYG) is rated Buy by Wall Street analysts as of 2026. Of 24 analysts covering the stock, 14 rate it Buy or Strong Buy, 8 rate it Hold, and 2 rate it Sell or Strong Sell. The consensus 12-month price target is $3, implying -49.4% from the current price of $5. The bear case scenario is $3 and the bull case is $28.
02What is the LYG stock price target for 2026?
The Wall Street consensus price target for LYG is $3 based on 24 analyst estimates. The high-end target is $3 (-49.4% from today), and the low-end target is $3 (-49.4%). The base case model target is $13.
03Is Lloyds Banking Group plc (LYG) stock overvalued in 2026?
LYG trades at 13.0x times forward earnings. The stock currently trades at a discount to the broader market. Based on current multiples versus the peer group, the relative model signals overvalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for Lloyds Banking Group plc (LYG) stock in 2026?
The primary risks for LYG in 2026 are: (1) UK Economic Conditions — Lloyds’ profitability is tightly linked to the UK economy, which is currently experiencing low growth, potential inflation, and global shocks. (2) Interest Rate Sensitivity — The bank’s net interest margin benefits from rising rates but also exposes it to higher mortgage servicing costs and borrower default risk. (3) Data Breaches & App Glitches — Recent operational incidents, including data breaches and banking app glitches, have eroded customer trust and attracted regulatory scrutiny, creating reputational and compliance risks that could lead to fines or remediation costs. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is Lloyds Banking Group plc's revenue and earnings forecast?
Analyst consensus estimates LYG will report consensus revenue of $72.3B (+11.2% year-over-year) and EPS of $0.71 (+127.2% year-over-year) for the upcoming fiscal year. The following year, analysts project $89.8B in revenue.
06When does Lloyds Banking Group plc (LYG) report its next earnings?
A confirmed upcoming earnings date for LYG is not yet available. Check the Earnings section above for the most recent quarterly report dates and forward estimates.
07How much free cash flow does Lloyds Banking Group plc generate?
Lloyds Banking Group plc (LYG) generated $0 in free cash flow over the trailing twelve months. LYG returns capital to shareholders through dividends (3.3% yield) and share repurchases ($1.7B TTM).