It certainly has been a fantastic month for the National Australia Bank Ltd (ASX: NAB) share price.
Since the start of November, the banking giant's shares have rallied an impressive 25% higher.
This means the NAB share price is now trading a whopping 76% higher than its COVID-low of $13.20.
Why is the NAB share price racing higher in November?
There have been a number of catalysts for NAB's strong share price gains in November.
The first is of course the positive developments that are being made with COVID-19 vaccines. This month no less than three vaccine candidates have been shown to be highly effective against the virus.
This has sparked hopes that the pandemic could be over sooner than expected, reducing the risk of an economic disaster.
It also has the potential to give the housing market a lift in 2021, which would be great news for the banks and could underpin demand for mortgages.
Another catalyst has been the shift away from high-flying COVID winners like Kogan.com Ltd (ASX: KGN) and NEXTDC Ltd (ASX: NXT) by investors.
A significant amount of funds has shifted away from this side of the market this month and into beaten down areas like the banks.
And finally, the prospect of bigger dividend payments has given the banking sector a lift.
Earlier this year at the height of the pandemic, APRA told the banks to keep their payout ratios below 50% of earnings. This was designed to ensure their balance sheets remained robust during these challenging times.
However, with the worst seemingly over and their provisions appearing to be more than sufficient, APRA is considering the relaxing of its dividend cap.
This would be great news for income investors in this low interest rate environment.
Is it too late to buy NAB shares?
One broker that still sees some upside for NAB's shares is Ord Minnett. It currently has an accumulate rating and $24.20 price target on its shares.
The broker is also forecasting a dividend of $1.00 per share in FY 2021 and then $1.10 per share in FY 2022. This represents fully franked yields of 4.2% and 4.6%, respectively, based on the current NAB share price.
