The National Australia Bank Ltd (ASX: NAB) share price has risen by more than 12% (at the time of writing) in the past month. Experts believe the ASX bank share can continue to deliver positive returns for investors from here.
NAB recently reported its FY26 first quarter update to investors, which showed cash profit of $2.02 billion, up 16% year-over-year. The underlying cash profit increased by 11% year-over-year.
Revenue rose 6% while expenses were broadly flat. It reported a credit impairment charge of $170 million, with the ratio of non-performing loans falling.
Let's take a look at what experts think of the numbers and the NAB share price.
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UBS views on the ASX bank share
The broker described the first quarter result as "strong", with the growth stronger than what UBS and other market analysts were expecting (of 10.4% growth).
UBS highlighted that while costs were flat compared to the second half of FY25, costs rose 5% year-over-year which was driven by tech and staff inflation.
The broker believes that NAB's business lending is expected to "benefit from favourable structural trends", which is a key reason for UBS' positive view on the ASX bank share.
UBS also said that NAB's numbers show it is more profitable than its peers, apart from Commonwealth Bank of Australia (ASX: CBA).
The broker thinks investors will be focused on continued cost management, as well as loan growth. UBS noted that cost guidance in FY26 is that its growth will be less than 4.6%.
UBS said that "asset quality looks stable and the credit environment appears mid-cycle, and likely to benefit NAB more than peers".
Earnings expectations increased
On the back of the better-than expected result in the first quarter of FY26, UBS decided to increase its earnings per share (EPS) forecast for FY26 by 2.8%, for FY27 by 2.1% and for FY28 by 0.7%.
These increases were "largely driven" by improving margins, in terms of the net interest margin (NIM). The NIM measures how much profit a bank makes on its lending in percentage terms, including both the loan rate and the cost to fund the loans (like term deposits and savings accounts).
On top of that, UBS decided to reduce what credit charges it's expecting for NAB in FY26 and FY27.
UBS rating on the NAB share price
The broker currently has a buy rating on the ASX bank share, with a NAB share price target of $50.50. At the time of writing, that implies a possible rise of 7% over the next year, plus whatever dividends the bank decides to pay.
