Own ANZ shares? Here's your first-half results preview

Will ANZ announce a buyback with its half-year results?

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National Australia Bank Ltd (ASX: NAB) kicked off earnings season in the banking sector this morning with its half-year results.

Those results went down well with the market. So much so, that NAB shares are charging higher today.

The attention will soon turn to ANZ Group Holdings Ltd (ASX: ANZ) and its shares, with the fellow big four bank due to release its half-year results next week.

Ahead of the release, let's take a look at what the market is expecting from the banking giant.

ANZ half-year results preview

According to a note out of Goldman Sachs, its analysts are expecting ANZ to report cash earnings (before one-offs) of $3,683 million for the first half. This represents a 4% decline on the prior corresponding period.

This estimate is ahead of the market's expectations, with the consensus estimate currently for cash earnings of $3,531 million.

One thing that Goldman and the market agree on is the bank's interim dividend. They are both forecasting a payout of 81 cents per share. This will be flat on the prior corresponding period.

Other key metrics to look out for are its net interest margin (NIM) and CET1 capital ratio. Goldman is forecasting 1.61% and 13.5%, respectively, for these metrics. The former will be down 14 basis points from 1.75% in the prior corresponding period.

Will ANZ buy back shares?

NAB pleased investors this morning when it announced an additional $1.5 billion on-market share buyback with its results.

Well, the good news is that Goldman Sachs believes that ANZ is likely to follow suit and buy back its own shares. Particularly given that it should still have significant surplus capital even after acquiring the banking operations of Suncorp Group Ltd (ASX: SUN). The broker commented:

ANZ's 1Q24 CET1 ratio was tracking at 13.06% (11.86% pro-forma adjusting for the NOHC surplus and announced Suncorp Bank acquisition) and we estimate this translates to c.A$4.7 bn of capital surplus against an 11% CET1 ratio. We highlight the potential for capital management given i) strong (arguably excess) levels of provisioning amidst an improving macro backdrop which has resulted in benign loan losses, and ii) all other major bank peers have announced and are in the process of completing on-market buybacks. We expect ANZ to announce a A$1.5bn on-market buyback at its 1H24 result.

Time will tell if that is the case. But investors won't have to wait long. ANZ is scheduled to release its half-year results on Tuesday 7 May.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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