The National Australia Bank Ltd (ASX: NAB) share price has been a strong performer in recent times. The banking giant is on the mends as the Australian economy gets back on track from the impacts of COVID-19.
At the time of writing, the financial services company’s shares are swapping hands for $26.45, up 0.23% for the day so far.
On the road to recovery
Investors appear pleased with NAB’s handling of the sudden and sharp shockwave of the pandemic.
In the company’s most recent quarterly update (Q1), NAB advised its financial position remains strong. The bank noted that economic trends were improving, with it recording earnings of $1.65 billion. This was 47% higher than the FY20 second-half quarterly average, primarily driven by low credit impairment charges.
In addition, NAB stated that its underlying performance was sound in the current competitive, low-interest-rate environment. The business saw reductions in the deferral of repayments as business conditions improved. Cash earnings growth lifted by 1% when compared against the prior corresponding period.
With this positive news, NAB shares have come a long way from their COVID-19 lows of around $15 seen on 23 March 2020.
NAB is scheduled to report its FY21 half-year results to the ASX on 6 May.
After reporting its quarterly results, a number of brokers rated the company with similar price points. Swiss investment firm UBS raised its price target for NAB by 8% to $27.00. Morgan Stanley followed suit to also increase its rating by 3.3% to $25.30. The most recent broker note, however, came from Macquarie late last month, which has initiated a price of $26.75 for the company.
NAB share price summary
The NAB share price has accelerated over the past year — up by almost 70% — particularly since the start of November. The rise in the company’s shares arguably reflects Australia’s success in managing the economic impacts of the pandemic.
On valuation grounds, NAB commands a market capitalisation of around $87.2 billion, with almost 3.3 billion shares on issue.