If there's one thing we can say for certain regarding ASX 200 shares and 2024, it's that the ASX bank stocks have had an absolutely incredible year.
All four of the major banks have hit new 52-week highs this year, and all four have notched gains that would be eye-watering for any ASX share, but particularly for these stocks that don't (or didn't) exactly have a reputation for galloping share prices. Well, that's with the clear exception of Commonwealth Bank of Australia (ASX: CBA).
If you haven't heard the combination of the phrases 'CBA share price' and 'all-time high' this year, you have probably been living under a financial rock. The ASX's largest bank stock has truly been on a blowout this year, booking dozens of new record highs.
CBA started 2024 at around $113 a share but has since blown through $120, $130, and now $140 a share. Just today, the bank reset its all-time record yet again with a new high of $144.25.
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New highs all around for ASX 200 bank stocks
The rest of the big four banks haven't been quite so lucky – all three records that were set years ago remain (at least for now). But they have all still dazzled investors with massive share price surges.
National Australia Bank Ltd (ASX: NAB) also hit a new 52-week high today of $39.05. This ASX bank stock is now up over 26% year to date, although it remains below the $41 levels we saw back in 2007.
It's a similar story with Westpac Banking Corp (ASX: WBC). This Friday has seen Westpac hit a new 52-week high of $32.17, which puts the bank up a massive 38.8% this year. Westpac got to around $40 back in 2015 though, so there's still a long way to go for a new record high.
Finally, ANZ Group Holdings Ltd (ASX: ANZ) has also been a solid performer this year, although it (as is usual these days) is the laggard amongst its big four peers. ANZ has also clocked a new 52-week high today, this one at $31.88 a share. That puts ANZ up 22.4% in 2024.
So we've established it's been a great year for the ASX 200 bank stocks (and thus the ASX 200 in general). But would I continue to buy the banks at these latest highs?
How high is too high?
The only ASX bank I have bought in recent years is NAB. NAB remains my preferred investment in this sector, thanks to its robust business banking division and quality management team. But saying that, I'm not too tempted by the current NAB share price, which I think is starting to look a little stretched.
Banks tend to be cyclical stocks over the economic cycle, and so I think there'll be a better buying opportunity going forward. I can't see NAB climbing too much further from here unless the ASX has a massive melt-up.
But if there were a proverbial gun to my head today to buy an ASX bank, this would be it. I do regard CBA as the ASX's highest-quality bank, but its current share price is getting ridiculous. It would have to almost halve from its current levels before I picked it over NAB.
But if I were an income investor or retiree who is solely concerned with reliable dividend income, ANZ would be my preferred ASX bank stock today.
Unlike Westpac, NAB and certainly CBA, ANZ currently still offers investors a dividend yield of over 5%. In fact, it was over 5.5% at recent pricing. Sure, ANZ's dividends don't usually come fully franked anymore. Even so, its yield would be more than enough for me to buy ANZ over Westpac's 4.6% or NAB's 4.3%. Let alone CBA's decidedly unbank-like 3.25%.
