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On Tuesday, Barclays (LON:BARC) analyst Carole Madjo revised the firm’s stance on Burberry Group (OTC:BURBY) PLC (BRBY:LN) (OTC:BBRYF), upgrading the luxury fashion brand from Underweight to Equalweight. The analyst also increased the price target to £10.00, up from the previous £7.20.
The upgrade by Barclays comes after a detailed review of Burberry (LON:BRBY)’s recent financial performance and the conclusion of the reporting season. Madjo noted that Burberry’s high-end brand positioning, which was previously perceived as being at risk, has now stabilized. This change in perspective is a key factor in the revised rating.
Burberry, which experienced a loss at the EBIT level in the first half of 2025, managed to return to profitability in the second half of the year. This turnaround is significant as it indicates a positive trajectory for the company’s earnings before interest and taxes (EBIT). Looking ahead, the analyst anticipates further improvement in Burberry’s EBIT for the fiscal year 2026.
The analyst also pointed out that Burberry announced a higher amount of cost savings than previously expected. This strategic move is expected to provide the company with a buffer against potential economic challenges that could arise. Despite these positive developments, the Barclays analyst cautioned that Burberry’s brand transformation is still in its initial phases and that short-term revenue growth might remain in negative territory.
The revised price target to £10.00 reflects the analyst’s increased confidence in Burberry’s ability to navigate through its ongoing transformation and the expected benefits from cost-saving measures. While acknowledging the early stage of the brand’s evolution, the new price target suggests a more optimistic outlook for Burberry’s financial prospects.
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