National Australia Bank Ltd (ASX: NAB) shares have had a disappointing year.
Since the start of 2023, the banking giant's shares have fallen 6%.
But could a Santa rally be on the way and take the bank's shares back to $30? Let's find out.
Could NAB shares hit $30 by Christmas?
Firstly, it is worth remembering that it's near impossible to predict short-term price movements. But we can at least see what could be possible.
With the company's shares currently changing hands for $27.95, it would take a 7% gain to reach our target.
The good news is that it is more than possible for NAB's shares to move by that magnitude in the time we have between now and Christmas. For example, between 10 July and 19 July, the bank's shares rose 9% from $25.64 to $27.98.
But do analysts think $30 is reasonable for its shares?
Goldman Sachs does. It currently has a buy rating and a $30.52 price target on its shares. This implies a potential upside of 9% from where they currently trade.
The broker likes NAB due to its commercial banking exposure. It said:
[W]hile lending competition is intense, it has been skewed more heavily towards housing as opposed to business, which should benefit NAB's relative earnings mix. NAB has delivered the highest levels of productivity over the last three years and its investments continue to yield benefits (A$400 mn of productivity expected in FY24E), which we think leaves it well positioned for an environment of elevated inflationary pressure.
Though, it is worth noting that Goldman is a bit of an outlier with its valuation. Citi, Macquarie, and Morgans all have the equivalent of hold ratings on its shares with price targets averaging out at approximately $28.
Time will tell, but there's hope for shareholders.
