Broker snap: Lloyds is 'dysfunctional but cheap', says Evolution

Evolution Securities reiterated its buy rating and 50p target price on Lloyds, saying that while it may be "dysfunctional", the stock remains cheap given the 66% share price fall since February.Though Lloyds says that its chief executive, António Horta-Osório, is making good progress after being ordered by his medical advisors to take a rest, the part-nationalised lender has made contingency plans just in case he does not return to the role by the end of the year as originally planned. The company said that David Roberts, a non-executive director and chairman of Lloyds' Risk Committee, will take over as interim group chief executive if Horta-Osório's recuperation period takes longer than initially envisaged. Furthermore, chief financial officer Tim Tookey (currently sitting in the chief exec's chair) is to leave.Evolution analyst Ian Gordon said: "Lloyds' statement this morning smacks of a knee-jerk response to market clamour for 'clarity' but provides nothing of the sort. That said, in Lloyds' defince, we are not at all sure that there is much that it could usefully have said today."The lender also revealed that Nathan Bostock, presently Royal Bank of Scotland's (RBS) head of restructuring and risk, will not now be leaving RBS to take charge next year of Lloyds' wholesale banking division. "Lloyds' dysfunctional chain of command makes for good gossip (and negative sentiment). Ultimately however, it doesn't materially impact the investment case, for which an entry level of 0.4 times tNAV [tangible net asset value] is compelling," Gordon said.Lloyds was among the worst performers of the day on the FTSE 100, trading 6.01% down at 23.68p.BC