Insights

Is the Westpac (ASX:WBC) share price in the buy zone?

Here’s what this broker thinks about this banking giant…
The post Is the Westpac (ASX:WBC) share price in the buy zone? appeared first on The Motley Fool Australia. –

The Westpac Banking Corp (ASX: WBC) share price is under pressure on Friday.

In afternoon trade, the banking giant’s shares are down 1% to $25.28.

Is the weakness in the Westpac share price a buying opportunity?

One leading broker that believes the weakness in the Westpac share price is a buying opportunity is Morgans.

This morning the broker has updated its forecasts, resulting in its analysts retaining their add rating and $29.50 price target.

Based on the latest Westpac share price, this implies potential upside of almost 17% over the next 12 months. And with Morgans forecasting a dividend yield of 4.5% over the same period, this potential return stretches beyond 21%.

What did the broker say?

Morgans has updated its forecasts to reflect the sale of its Westpac Life New Zealand business and potential fraud provisions relating to Forum Finance.

While this has resulted in a 2% reduction in its FY 2021 earnings estimates, its longer term forecasts are not materially impacted.

Morgans said: “WBC has also said that it has a potential exposure of ~$200m after tax to Forum Finance, with the extent of any loss dependent on the outcome of its investigations and recovery actions underway.

”We understand that the recovery process may play out over a prolonged period, and we therefore expect WBC to raise an individually assessed provision of ~$290m for the full exposure to Forum Finance in 2H21F. However, we see potential for this provision to be partially written back over time,” it added.

“We have reduced our FY21F cash EPS by 2% as a result of the higher credit impairment charge stemming from the Forum Finance exposure. We have not materially changed our cash EPS forecasts for the outer years,” Morgans concluded.

The post Is the Westpac (ASX:WBC) share price in the buy zone? appeared first on The Motley Fool Australia.

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

Before you consider Westpac, 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 Westpac 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

Brokers name 3 ASX shares to buy today

The Westpac (ASX:WBC) share price is up 30% in 2021
Why analysts love Westpac (ASX:WBC) and this ASX 200 dividend share
NAB (ASX:NAB) share price up following prediction of no rate hike until 2024
Westpac (ASX:WBC) share price in focus after fraud latest

Motley Fool contributor James Mickleboro owns shares of Westpac Banking Corporation. 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!