Insights

Is now a good time now to buy National Australia Bank (ASX:NAB) shares?

Can this banking giant continue its strong form?
The post Is now a good time now to buy National Australia Bank (ASX:NAB) shares? appeared first on The Motley Fool Australia. –

The National Australia Bank Ltd (ASX: NAB) share price has been a positive performer in 2021.

Since the start of the year, the banking giant’s shares have climbed a sizeable 14%.

Where next for NAB shares?

Although the NAB share price is up 14% in 2021, one leading broker believes there’s still room for its shares to run higher. That broker is Goldman Sachs. In fact, it currently has NAB shares on its conviction list. According to a recent note, the broker has a conviction buy rating and NAB share price target of $29.97.

Based on the current NAB share price of $26.21, this implies potential upside of 14% over the next 12 months.

In addition to this, the broker is expecting the NAB dividend in 2021 to be on the generous side. Goldman is forecasting a fully franked dividend of $1.24 per share. This represents a yield of 4.7%, which extends the potential return to a total of ~19%.

Goldman commented: “We reiterate our Buy (on CL) on NAB and it remains our preferred sector exposure given: i) NAB’s cost management initiatives, which seem further progressed relative to peers, should therefore drive productivity benefits sooner; ii) NAB’s position as the largest business bank, we believe it will be a bigger beneficiary of the continued economic recovery (management highlighting improving volumes momentum across the franchise, in particular SME); iii) versus peers, NAB, on a pro-forma basis, is well capitalised (it has significant buffer over target CET1 range of 10.75-11.25%), looks well positioned for capital management.”

Is anyone else bullish on the NAB share price?

Another broker that is on the bullish side is Credit Suisse. Its analysts currently have an outperform rating and NAB share price target of $27.50.

However, unlike Goldman Sachs’s NAB share price target, this only implies potential upside of 5% over the next 12 months. Though, with Credit Suisse forecasting the NAB dividend in 2021 to be $1.26 per share, the potential return stretches to 10%.

A third opinion

Finally, analysts at Citi are sitting on the fence with NAB shares. Its analysts currently have a neutral rating and $26.25 NAB share price target. This is broadly in line with where NAB shares are trading today.

In respect to the NAB dividend in 2021, Citi has pencilled in a $1.20 per share fully franked dividend. This represents a 4.6% dividend yield based on the latest NAB share price.

Citi was disappointed with recent anti-money laundering (AML) compliance news. That news reveals that AUSTRAC has launched an enforcement investigation into NAB’s compliance with AML regulations.

It commented: “Despite almost 4 years of rectification work, at a cost of ~$800m, NAB has continued to report non-compliance issues to regulators concerning their processes, procedures and documentation. We expect NAB will likely be forced to re-prioritise these rectifications under a new AUSTRAC-led timetable. Whilst we are not expecting civil penalties as this stage, higher operating cost growth must be inevitable to meet the regulator’s expectations.”

Time will tell which broker makes the right call.

The post Is now a good time now to buy National Australia Bank (ASX:NAB) shares? appeared first on The Motley Fool Australia.

Should you invest $1,000 in NAB right now?

Before you consider NAB, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and NAB wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

NAB (ASX:NAB) share price up following prediction of no rate hike until 2024
ANZ (ASX:ANZ) share price takes the cake among big four bank shares
2 buy-rated ASX dividend shares for income investors

ASX 200 Weekly Wrap: ASX finishes FY21 on a high

Broker names 2 ASX dividend shares to buy

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!