I’ve been waiting to buy Barclays (LSE: BARC) shares for two or three years. Is this finally my moment?

Back in 2023, I decided FTSE 100 banking stocks were impossible to ignore any longer. They’d served their time after the financial crisis and cleaned up their balance sheets. Yet they were still cheap. Price-to-earnings ratios sat firmly in single digits.

Better still, banks were among the few sectors to benefit from higher inflation and interest rates. That allows them to widen their net interest margins, the gap between what they pay savers and charge borrowers. Dividends were improving too, and share buybacks were back on the agenda.

FTSE 100 opportunity

I made my move – and bought Lloyds Banking Group. It felt the safer option. Lloyds focuses heavily on the UK economy, while Barclays has greater exposure to riskier overseas activities through its US corporate and investment banking arm. Lloyds also offered more income, with the dividend yield approaching 5% at the time.

There have been a few bumps, notably the motor finance mis-selling scandal, but overall I’ve got no complaints. In truth, all the major banks have done well. Profits have surged and investors have been rewarded. But I’m keen to add another bank and Barclays is a strong candidate. Its international reach should complement Lloyds nicely.

What stopped me was the share price. Barclays had been on a tremendous run. The valuation was rising too, with the price-to-earnings ratio heading towards 15. That felt a little rich and I hesitated. Now I’m glad I did.

Full-year results showed pre-tax profit rising 13% to £9.1bn. The bank also announced a new £1bn share buyback and pledged to return £15bn to investors over the next two years. Yet the market barely reacted. It wanted even more. That felt like a warning.

Then the Iran war erupted. The Barclays share price has dropped about 15% in the last month. That fall, combined with higher earnings in the recent results, have transformed the valuation. The P/E ratio has slipped to roughly 8.9. The dividend yield isn’t huge, since Barclays prefers buybacks, but it’s edged up to around 2.25%.

Tempting stock valuation

Yet there are risks to consider. If the artificial intelligence boom turns into a bubble, banks could see a surge in loan impairments. Barclays could also take a hit if the rapidly expanding private credit sector runs into trouble.

Then there’s geopolitics. Analysts at Alpine Macro warned the conflict is yet to deliver the “maximum panic” moment. If they’re right, share prices could fall further. Trying to pick the exact bottom is almost impossible though. Nobody rings a bell when the market turns.

What’s clear is that Barclays shares are 15% cheaper than they were a month ago and look far better value on a P/E basis. It’s also a well-established bank with global reach, strong profits and a clear commitment to returning cash to shareholders.

For me, that’s enough. I’ll start buying gradually and drip-feed money into the shares. Barclays isn’t the only FTSE 100 opportunity out there, far from it, and I’ll approach them in exactly the same way.