Although it has been a mixed year for shareholders of Westpac Banking Corp (ASX: WBC), thanks to a strong performance in the second half of the year it is finishing the year with a bang.
Fears over a housing market crash and a potential cut to its dividend put significant pressure on its share price in the first half of the year.
Thankfully, the market eventually saw past these concerns and its share price has now risen by over 15% since early July.
But after such a strong rally in its share price during the last six months is Australia's oldest bank still a buy today?
Whilst I certainly wouldn't class it as a sell due to its generous dividend, I don't think I would be rushing in to buy its shares at the current share price.
Much like rival Australia and New Zealand Banking Group (ASX: ANZ), I believe Westpac's shares are beginning to look fully priced now.
At 14x full year earnings and 1.9x book value, Westpac's shares are trading ahead of the sector average by some distance.
Because of this I would suggest investors hold off starting an investment at this point. Instead I would wait for a better entry point in or around the $30 mark.
Any investors looking for immediate exposure to the banking sector might be better off looking at an investment in Bendigo and Adelaide Bank Ltd (ASX: BEN).
Although its shares have rallied almost 40% in the last six months, the regional bank still trades at just 1.1x book value. This makes it the cheapest Australian bank based on book value.
