National Australia Bank Ltd (ASX: NAB) shares have underperformed the market over the last 12 months.
Since this time last year, the banking giant's shares have lost 7% of their value, as you can see on the chart below.
This compares unfavourably to a solid 9% gain by the S&P/ASX 200 Index (ASX: XJO) over the same period.
But that was the last 12 months. What about the future? What could a $10,000 investment today in NAB shares be worth this time next year? Let's find out.
What could $10k in NAB shares turn into?
Firstly, with the NAB share price currently fetching $27.00, a $10,000 investment would yield you approximately 370 shares in the big four bank. What could they be worth in 12 months?
According to a recent note out of Goldman Sachs, its analysts have a buy rating and a $30.69 price target on the bank's shares.
If the broker is on the money with its rating and valuation, your 370 NAB shares would be worth $11,355.30 in 12 months.
But the returns aren't likely to stop there. Like the other big four banks, each year the company shares a decent portion of its earnings with its shareholders in the form of dividends.
Goldman expects this to be the case again in FY 2023 and FY 2024. Its analysts have pencilled in fully franked dividends of $1.66 per share in both financial years.
This represents 6.15% annual dividend yields at current levels and would result in total dividends of $614.20 being paid over the next 12 months from your NAB shares.
If you were to reinvest these dividends, you would see the value of your investment increase to a total of $11,969.80 if Goldman's forecasts prove accurate. That's a total return on investment of almost 20% over the 12 months.
