Despite the flourishing of banking stocks, ANZ Group Holdings Ltd (ASX: ANZ) shares have been a mixed bag in 2024.
The bank has dealt with its fair share of headlines this year as well. All whilst shareholders have been forced to watch shares in the other banking majors soar to new highs.
With 2025 on the horizon, what's next for ANZ shares? Let's see what the experts think.
ANZ shares 'underperform' in 2024
While we're still a few weeks away from the new year, ANZ shares have underperformed several of their ASX banking peers this year.
Here's the thing though. The stock is up 20% so far in 2024. This is still a very good result. To sit here and scoff at a 20% return for the year is not good investment kocher. And it's hardly an 'underperformance' relative to long-term market returns.
In fact, you're probably very happy as an ANZ shareholder right now with this result.
In saying that, we're talking a relative performance here. And on that basis, ANZ shares have lagged behind the gains of its big four peers.
For context, Westpac Banking Corp (ASX: WBC) is up 43% this year to date, while Commonwealth Bank of Australia (ASX: CBA) has climbed 41%.
The rebound in home loan demand, which rose by 30% over the twelve months to November 31, has fuelled the broader rally in ASX 200 bank stocks recently.
But this wasn't reflected in the results of the banking majors in FY24.
ANZ itself delivered net profits of $6.5 billion in its FY24 earnings, down 8% on the prior year, but paid dividends of $1.66 per share.
What's the 2025 outlook for ANZ shares?
The first question we have to answer is whether it's worth looking at the banking sector for 2025, let alone ANZ shares.
According to Creditor Watch, the financials sector is well positioned here in Australia thanks to the strength of our property market in recent years.
[T]he household sector in aggregate [has] deleveraged significantly in recent years as house and share prices have risen sharply.
And for many of the still relatively low share of households getting into financial difficulty, the 20-40% rise in house prices since before COVID generally means that the asset can be sold often at a profit and almost always without a significant impact on bank losses.
Meanwhile, according to the Motley Fool's Tristan Harrison, Schroders has a similar view on this topic. It says "bad debts have remained near zero" and the "housing market will remain [a] crucial driver of equity markets".
But Harrison's view on bank stocks in 2025 is straight to the point: "I'm not expecting 2025 to be strong again."
According to CommSec, the consensus of analyst estimates also rates ANZ shares a sell, painting a fairly bearish sentiment picture.
Consensus estimates project ANZ to grow earnings by 9% over the next two years. Dividends, meanwhile, are forecast to grow by 1.8%, hitting $1.72 per share over this time. Based on this data, the outlook is mixed at best.
Is ANZ a buy for 2025?
ANZ shares aren't on the top of the buy list for most brokers this Christmas. The consensus rating is a sell, despite brokers projecting earnings growth over the next two years.
There's no telling what the overall banking sector or the ANZ share price does from here, though.
In the last 12 months, the stock is up 48%.
