ASX 200 bank stocks were a mixed bag on Friday amid a poor day for the stock market overall.
The S&P/ASX 200 Index (ASX: XJO) closed down 0.41% with nine of the 11 market sectors in the red.
Most ASX bank stocks have had an incredible year of share price growth, as the following chart shows.
After so much share price growth in 2024, are any of the ASX bank stocks still a buy?
Michael Hunstad is chief investment officer of global equities at one of the world's biggest active fund managers, Northern Trust Asset Management.
According to The Australian, Hudstad is not too concerned by our banks' historically high valuations.
He points out that ASX banks have been very profitable over the long term.
He says:
When you think about the Australian banking sector, it's an oligopoly, and regardless of where the multiple is, it's hard to have more competition that's really going to deflate that.
But many Australian-based analysts aren't so sure. On the CommSec trading platform, we reviewed the consensus ratings among analysts on each of the seven ASX bank stocks.
The most favourable consensus rating was a hold for National Australia Bank Ltd (ASX: NAB) shares, Macquarie Group Ltd (ASX: MQG), and Bendigo and Adelaide Bank Ltd (ASX: BEN).
The remaining bank stocks — Westpac Banking Corp (ASX: WBC), Commonwealth Bank of Australia (ASX: CBA), ANZ Group Holdings Ltd (ASX: ANZ), and Bank of Queensland Ltd (ASX: BOQ) — scored a moderate sell consensus rating.
ASX 200 bank shares mixed on Friday
Here's what happened with ASX bank stocks on Friday and in the year to date:
- NAB) shares closed at $37.57, down 0.13% on Friday and up 22% in 2024
- Westpac shares closed at $32.17, up 0.66% on Friday and up 39% in 2024
- CBA shares closed at $158.21, up 0.44% on Friday and up 39% in 2024
- ANZ shares closed at $29.13, up 0.03% on Friday and up 12% in 2024
- Macquarie shares closed at $226.22, up 0.29% on Friday and up 23% in 2024
- Bendigo shares closed at $13.23, up 0.3% on Friday and up 36% in 2024
- Bank of Queensland shares closed at $6.64, down 0.3% on Friday and up 9% in 2024
Which is the best ASX bank stock to buy?
We've reviewed recent broker notes on Westpac vs. Macquarie shares to help you decide which of the two is the best ASX bank stock to buy.
Here are some of the highlights of those notes.
Westpac shares
In its FY24 results, Westpac reported a 3% fall in net profit after tax (NPAT) to $7 billion.
Top broker UBS has a neutral rating on Westpac shares with a 12-month share price target of $33.
On the positive side, UBS believes there's scope for further capital management initiatives via buybacks or special dividends, given the bank's ~$3.5 billion franking balance.
The broker says Westpac's underlying net interest margin (NIM) patterns "continue to look encouraging".
On the negative side, UBS says Westpac's cost growth is a headwind.
Check out my colleague's article on the outlook for Westpac shares in 2025.
Macquarie shares
In its FY25 first-half result, Macquarie reported a 14% increase in NPAT to $1,612 million compared to 1H FY24. However, this also represented a 23% fall compared to the second quarter of FY24.
The report led to UBS downgrading its earnings forecasts for Macquarie over the next few years.
In a note, UBS said:
The investment case in our view continues to hinge around asset realisations, capital deployment and performance fees in MAM [Macquarie Asset Management], validation around the sustainability of profits within CGM and improvements in capital market activity, beneficial to MacCap [Macquarie Capital].
UBS has a neutral rating on Macquarie shares with a price target of $225.
Ord Minnett is more bullish.
It has a buy rating on Macquarie with a 12-month share price target of $245.
The broker points out that Macquarie has almost $11 billion in surplus capital. This provides opportunities for investments, growth, and dividends for shareholders.
Check out my colleague's article on the outlook for Macquarie shares in the new year.
