The National Australia Bank Ltd (ASX: NAB) share price is up an impressive 26% in 2021.
This is more than double the return of the S&P/ASX 200 Index (ASX: XJO) over the same period.
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Can the NAB share price keep climbing?
The good news is that it may not be too late to buy the banking giant's shares.
According to a note out of Goldman Sachs, its analysts continue to see value in the NAB share price even after its meteoric rise this year.
The note reveals that the broker has a conviction buy rating and $30.62 price target on the bank's shares.
Based on the current NAB share price of $28.85, this implies potential upside of 6% over the next 12 months before dividends.
And with Goldman forecasting fully franked dividends per share of 140 cents in FY 2022 and 145 in FY 2023, the potential return on offer stretches to 11% if you include FY 2022's dividend.
Why does the broker like NAB?
There are a few reasons that Goldman is so positive on the NAB share price.
It explained: "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 most of its peers, should drive productivity benefits sooner and free up investment spend to be directed more towards customer experience, as opposed to infrastructure (3Q21 update shows NAB is tracking well against this)."
"ii) given NAB's position as the largest business bank and investment in its mortgage capability, we believe it is strongly positioned to benefit from the current recovery in both housing and commercial volumes (3Q21 update showed continued volume momentum); iii) NAB continues to effectively manage the balance between volumes and margins as well as any peer," it added.
All in all, the NAB share price may be on fire this year, but this broker doesn't believe that fire is running out of fuel just yet.
