Bank of Queensland Ltd (ASX: BOQ) shares have been out of form this year.
As things stand, the regional bank's shares are on course to record a 12% annual decline.
This is despite the bank's shares rallying approximately 18% since the start of November.
But that was 2023. What is 2024 looking like for Bank of Queensland shares? Let's see what analysts are saying.
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Could Bank of Queensland shares return to form in 2024?
Unfortunately, the market remains largely bearish on Bank of Queensland shares at present. In fact, there's only one major broker that has a buy rating on them.
That broker is Ord Minnett, which has a buy rating and lofty $8 price target. The latter implies a potential upside of approximately 32% for investors over the next 12 months.
While it would be nice to see the bank's shares rise to that level, most brokers have price targets that imply material downside risk next year.
Bearish brokers
Among the most bearish brokers is Goldman Sachs, which has a sell rating and a $5.15 price target on its shares. This implies a potential downside of almost 15% for investors over the next 12 months.
The broker's sell rating is based on its costs outlook, weak volume momentum, and margin pressures. It explains
We are Sell-rated on BOQ given: i) while the company's transformation program is the right long-term strategy to deliver a strong and simpler bank, we believe it does leave the bank more exposed to inflation in third party distribution costs, and ii) we are concerned by the operational risks and costs pressures involved in undertaking such an initiative, furthermore iii) BOQ's volume momentum remains weak, and while this is partly due to management's efforts to protect profitability, BOQ's FY23/2H23 NIM fell materially (notably below market expectations) and we do not expect margin pressures to ease given the current challenging environment (intense competition in both lending and deposits).
