Westpac Banking Corp (ASX: WBC) shares are dipping to the downside today amid a broad-based sell-off across ASX shares.
As we head into the afternoon, the major bank's share price is 0.51% lighter at $23.38. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is carrying a heavy 1.45% fall.
The financials sector is one of the lesser impacted corners of the market today. Though the bank-laden sector is 1% in the red, other areas of the market — such as materials — have been struck with declines of more than 2.5%.
Today, onlookers and holders of Westpac shares might now be contemplating what to do in the lead-up to the company's FY22 full-year results.
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Banking on a solid result
Firstly, Westpac has 7 November earmarked as the day it will release its FY22 numbers to the public.
The information contained in this report could act as a catalyst for the Westpac share price, so investors are paying attention. As of today, that announcement is only three weeks away.
At the moment, expectations for the bank's financial accounts are relatively rosy. However, this isn't necessarily a Westpac-only phenomenon.
Instead, the improvement in sentiment likely stems from the affirmation of higher interest rates resulting in improved margins.
This affirmation was provided by Bank of Queensland Ltd (ASX: BOQ) last week upon the release of its full-year report.
Namely, the bank's net interest margin (NIM) at the end of the financial year slotted in at 1.81%, compared to its second-half average of 1.75%. As a result, analysts — such as those at Goldman Sachs — believe Westpac shares could be in for a similar boost.
As my colleague previously covered, the broker considers Westpac the best bank to benefit from rising rates. As such, the Goldman team has assigned a $27.08 price target to the company, suggesting a further ~15% upside.
Furthermore, Refinitiv Eikon data puts the bank's FY23 dividend yield estimate at 6%. For income investors, this could be an appetising offer to provide some form of an inflation hedge.
Westpac shares in the rearview
Looking across the big four banks, Westpac shares have been the best ones to hold so far this year.
In contrast to negative returns from the likes of Commonwealth Bank of Australia (ASX: CBA) and Australia and New Zealand Banking Group Ltd (ASX: ANZ), Westpac has climbed 8% into the green.
The only other big four constituent to dish out a positive return has been National Australia Bank Ltd (ASX: NAB). Though, NAB's share price has appreciated a more modest 5.6% in 2022.
