Yahoo Finance At AU$16.52, Is It Time To Put Australia and New Zealand Banking Group Limited (ASX:ANZ) On Your Watch List?
Let's talk about the popular Australia and New Zealand Banking Group Limited (ASX:ANZ). The company's shares saw a double-digit share price rise of over 10% in the past couple of months on the ASX. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s examine Australia and New Zealand Banking Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
Check out our latest analysis for Australia and New Zealand Banking Group
What's the opportunity in Australia and New Zealand Banking Group?
According to my valuation model, Australia and New Zealand Banking Group seems to be fairly priced at around 4.34% above my intrinsic value, which means if you buy Australia and New Zealand Banking Group today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth A$15.83, there’s only an insignificant downside when the price falls to its real value. Furthermore, Australia and New Zealand Banking Group’s low beta implies that the stock is less volatile than the wider market.
What kind of growth will Australia and New Zealand Banking Group generate?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Australia and New Zealand Banking Group’s earnings over the next few years are expected to increase by 51%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? ANZ’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping an eye on ANZ, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Australia and New Zealand Banking Group. You can find everything you need to know about Australia and New Zealand Banking Group in the latest infographic research report. If you are no longer interested in Australia and New Zealand Banking Group, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
Love or hate this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Thank you for reading.
