The Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price will be one to watch later this month.
On 28 October, the banking giant is scheduled to release its full year results for FY 2021.
Ahead of the release, I thought I would look to see what the market is expecting the bank.
What should you expect from ANZ in FY 2021?
According to a note out of Bell Potter, its analysts are expecting ANZ to report a big rebound in its profits in FY 2021.
The broker is forecasting statutory profit of $5.78 billion and a cash profit of $5.82 billion for the 12 months. This represents an increase of 61.6% and 55%, respectively, over the prior corresponding period.
From this, Bell Potter is expecting a fully franked final dividend of 70 cents per share. This will bring its full year dividend to $1.40 per share, which is more than double the COVID-impacted dividend of FY 2020.
Bell Potter commented: "Overall changes include lower net interest income (2% lower, mainly due to lower volumes and despite a 1bp increase in NIM in 2H21 from good NIM management) and lower other banking income (18% lower mainly from institutional banking although there was a gain of around 12% in 2H21) offset by lower operating expenses (the bank continues to manage costs relatively well, down from $4.78bn in 2H20 to $4.48bn in 1H21 and a forecast of $4.23bn in 2H21) plus a benefit in credit impairment charge in the first half of $0.49bn and back to an expense of $74m in 2H21 (as the industry further normalises)."
Is the ANZ share price good value?
Bell Potter sees a lot of value in the ANZ share price at the current level. Its analysts have a buy rating and $31.00 price target on its shares.
Based on the latest ANZ share price of $27.76, this implies potential upside of almost 12% over the next 12 months.
And that doesn't include dividends. Bell Potter expects ANZ to lift its dividend to $1.45 per share in FY 2022. This represents an attractive 5.2% dividend yield, bringing the total potential return to approximately 17%.
