The Lloyds (LSE:LLOY) share price has trailed the broader FTSE 100 so far this calendar year. But the high street bank has still performed brilliantly since 1 January, soaring 17% in value to 114.6p. The broader FTSE 100 is up 19% by comparison.

And if City analysts are correct, Lloyds shares should continue rising. But just how high could they go?

Turning £10,000 into…

Lloyds’ share price has risen a spectacular 107% in just two years. Yet, brokers are generally confident the party isn’t over. It’s why of the 19 of them who rate the FTSE company, 12 of them consider it a Buy. Six have slapped a Hold rating on it. Just one believes the bank is a Sell.

However, price estimates aren’t quite as emphatic. The most bullish analyst thinks Lloyds shares will rise another 17% over the next 12 months, to 135p per share. But the average share price among those 19 analysts is far less impressive. This is 119.3p, suggesting just a 3% increase from current levels.

That doesn’t necessarily mean investors should prepare for a terrible overall return, though. With predicted dividends thrown in, a £10,000 investment in Lloyds today could turn into £10,690 by next August. This is based on a return of 7%.

Is Lloyds an investment opportunity?

Still, that’s not the most exciting share price forecast on the FTSE 100. Yet, analysts don’t always get it right — few had forecast that Lloyds’ share price would have more than doubled over the past two years. A repeat performance is quite possible.

What’s more, the bank may still be an attractive choice for investors seeking passive income. Lloyds’ dividend yield is a healthy 3.9% for 2026. Predictions of robust dividend growth push this reading to 4.5% for next year, too, and 5.3% for 2028.

And the banking giant looks in good shape to pay those expected dividends. They’re covered between 2.2 and 2.3 times by predicted earnings over the period, providing a wide safety buffer. Lloyds has a strong balance sheet as well that’s helping it support shareholder returns. Its Common Equity Tier 1 (CET1) ratio was a rock-solid 13.1% as of June.

Here’s what I’m doing…

There’s no doubting Lloyds’ resilience in what’s been a tough period for the UK economy. Supported by ongoing cost-cutting and higher interest rates, pre-tax profit rose 14% in the first half.

The bank’s now raised its targets through to 2030, including a new five-year goal of achieving “mid-single-digit” annual net income growth. But here’s the thing: how robust will Lloyds (and its share price) prove when interest rates fall, and as the UK economy continues struggling for growth and competition surges?

I can’t help but worry. And given Lloyds’ high valuation — its price-to-book (P/B) ratio of 1.5 is miles above a long-term reading of 0.9 — I strongly believe much of the good news is now baked into its shares.

If I’m right, there could be limited room for Lloyds to rise. Yet, that’s not all. If the bank’s recent resilience begins to buckle, we could see a sharp correction.

I’m not expecting Lloyds’ share price to slump 54% over the next year, as one analysts believes. Their 12-month price forecast is just 53p. But on balance, I think there’s much more attractive FTSE 100 shares to consider than Lloyds.

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Royston Wild does not hold any positions in the companies mentioned.

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