While the big four banks often dominate headlines, it's ASX bank stock Judo Capital Holdings Ltd (ASX: JDO) getting attention this week.
Judo Capital is an Australian bank focused on lending to small and medium enterprises (SMEs).
Its Judo Bank brand provides business lending starting at $250,000 and touts itself as providing more flexibility than major banks. It also offers personal term deposit products and home loans.
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Relative underperformance
So far in 2026, this ASX bank stock has underperformed relative to its peers.
Year to date, its stock price is down more than 20%.
In that same span, the S&P/ASX 200 Financials Index (ASX: XFJ) has climbed just over 2%, and some of the larger bank stocks have risen by much more.
For comparison:
However, the 20% dip for Judo shares could be a buy-low opportunity, according to brokers, after positive results were released last week.
What did Judo report?
Last week, this ASX bank stock released an update on financial performance, asset quality, and FY26.
The company reinforced that its lending growth, net interest margins, and operating expenses all remain on track to meet existing guidance, "resulting in Judo reaffirming guidance for FY26 profit before tax of between $180 million – $190 million".
Judo Bank reported:
- Gross loans and advances reached $13.8 billion at 31 March, up from $13.4 billion at December 2025
- Net interest margin (NIM) rose to approximately 3.15% for Q3, up from 3.03% in 1H26
- Total deposits increased to $11.5 billion, with the blended cost of deposits at 0.74% over 1‑month BBSW
- Operating expenses remained in line with previous guidance.
Brokers react positively
Following the report, both Morgans and Macquarie provided updated guidance on this ASX bank stock.
The team at Morgans sees the recent share price weakness as a buy-low opportunity.
We view JDO's recent share price weakness as a buying opportunity for a stock with high growth potential, increasing the margin of safety for the investment. Upgrade from ACCUMULATE to BUY. Potential TSR at current prices is c.49%.
Meanwhile, Macquarie also sees upside for this ASX bank stock.
As Cameron England reported, Macquarie said the underlying revenue performance was strong, "with continued lending book growth and positive margin momentum".
The broker said they remained of the view that Judo would beat its guidance on margins in the second half.
It has an outperform rating on Judo shares, with a 12-month price target of $1.85.
From the current share price of $1.43, the updated target indicates a potential return of 29.4%.
