Early in June the Westpac Banking Corp (ASX: WBC) share price fell towards the $29.00 level as concerns over the impact the government's budget levy would have on the banks weighed heavily on investor sentiment.
Since then it hasn't looked back and today has climbed back above the $32.00 mark again.
Is it too late to buy Westpac shares?
Whilst I definitely think that the $29-$30 level is a great entry point, I still see value in Westpac's shares at the current price. Especially with its out of cycle rate rises boosting its bottom line.
In my opinion, Westpac is second only to Commonwealth Bank of Australia (ASX: CBA) in quality. But in terms of value, it certainly comes out on top.
Even after its solid run since June and the fall from grace of Commonwealth Bank's shares, Westpac's shares are still cheaper than its rival.
At present Westpac's shares are changing hands at just over 13x estimated forward earnings and 1.8x book value. By comparison, Commonwealth Bank's shares trade at a little under 14x earnings and 2.1x book value.
Further to this, Westpac provides investors with a trailing fully franked 5.8% dividend, whereas its larger rival currently provides a trailing fully franked 5.6% dividend.
And with Deutsche Bank recently rating its shares as a buy with a $34.50 price target, there could potentially be a total return of 12.5% for investors over the next 12 months based on its current share price.
All in all, I think this makes Westpac the best option in the banking sector at the moment. Despite its solid run, I still class Australia's oldest bank as a buy.
