Shares of ASX titans Woolworths Limited (ASX: WOW) and National Australia Bank Ltd (ASX: NAB) have today been mercilessly sold off…
Source: Yahoo! Finance
Down 4.1% and 4.6%, respectively, Australia's largest supermarket operator and the third largest bank have each been caught up in a vicious global sharemarket selloff.
National Australia Bank shares are down a whopping 11.8% in a single month. Having climbed to a high of $34.82 earlier this month, the leading $81 billion business bank has been unable to avoid the market's wrath despite recently posting a respectable third-quarter trading update.
Meanwhile, the market is eagerly awaiting the latest report from Woolworths – due later this week – following a strong profit update from rival Wesfarmers Ltd (ASX: WES) last week. Indeed, despite operating our country's largest supermarket network and providing non-discretionary goods to many millions of Australians every week, the market took a scalpel to 4.1% of the company's shares today.
Is it time to buy in?
I've previously noted that my fair value estimate for Woolworths shares is between $27 to $28. However, while they may appear cheap at a current price of $25.29, before I buy more shares I'm waiting to see how the group reports this week – I suggest you do the same.
As for National Australia Bank Ltd shares, I've also pegged fair value around $28. However, that figure did not include the bank's recent record-breaking capital raising or APRA's changes to risk-weights on investor loans. At $29.71, NAB shares would have to drop to around $20 (so to ensure a healthy margin of safety) before I'd get excited about buying shares.
