26th February 2016
Royal Bank of Scotland (RBS) has reported its eighth straight year of losses and analysts continue to avoid the stock.
The bank has reported its Q4 results that showed another year of losses although net losses did narrow to £1.98 billion from £3.46 billion year-on-year. This is the eighth straight year of losses for the bank since it was bailed out by taxpayers during the financial crisis.
Graham Spooner, investment research analyst at The Share Centre, said the bank is set to shift its business towards retail and commercial banking as part of a restructure.
However, even this cannot entice analysts to recommend buying the stock.
‘The chief executive’s restructuring plans will shrink the group further, through to 2020,’ he said.
‘The share price has continued to fall over the last twelve months and is now close to a three-year low. We would still suggest avoiding the stock, as there are better opportunities to be had in the market.’
Spooner added that his preference in the banking sector is HSBC and ‘we recommend the company as a ‘buy’ for medium risk income seekers’.
‘The company has remained a significant payer through difficult times. Progress may continue to be slow in the face of many challenges, as a result we would suggest investors drip feed into the shares for the long-term,’ he said.