Top broker tips Bank of Queensland (ASX:BOQ) share price as a buy

The Bank of Queensland Limited (ASX: BOQ) share price has been a strong performer in 2021.

Since the start of the year, the regional bank's shares are up 26%.

Where next for the Bank of Queensland share price?

The good news for shareholders is that one leading broker believes the Bank of Queensland share price can still go higher from here.

According to a note out of Goldman Sachs, it has retained its buy rating and $10.09 price target on the bank's shares.

Based on the current Bank of Queensland share price of $9.50, this implies potential upside of 6.2%.

In addition, Goldman is forecasting a fully franked dividend per share of 45 cents in FY 2022. If you add this into the equation, the total potential return on offer increases to almost 11%.

What did the broker say?

Bank of Queensland is due to release its full year results next week and Goldman is expecting strong earnings growth.

The broker is forecasting full year cash earnings of $406 million. This will be an increase of 80% year on year.

A key driver of this growth will be its above system lending growth and a steady recovery in business lending according to Goldman.

It commented: "For 2H21, BOQ expected to achieve with a steady recovery in business lending through 2H21. (GSe housing +2.8% vs. system (ex-ME Bank), business -1%). We will be keen to hear management commentary around the sustainability of its volumes growth and whether this can be achieved with a reasonable NIM outcome. We note that the recent month's APRA data indicates 4 straight months of improved momentum (tracking at 13.3% on a 3m ann. basis) and we remind investors that at its 1H21 result, BOQ guided to 2H21 NIM (ex-ME Bank) to be flat hoh."

Looking ahead, the broker expects the company's cash earnings growth to continue. It has pencilled in cash earnings of $467 million. This will be an increase of 15% and includes the benefits of the recent acquisition of ME Bank.

All in all, the broker appears to believe this makes the Bank of Queensland share price good value at the current level.