The Westpac Banking Corp (ASX: WBC) share price has had a very strong start to 2019 thanks largely to the conclusion of the Royal Commission.
Since the start of the year the banking giant's shares have pushed approximately 6.5% higher.
Is it too late to buy the banking giant's shares?
Whilst Westpac would not be my first pick in the banking sector at this point, I do think that its shares are still a good option for investors that have little or no exposure to the banking sector.
This is largely down to the fact that its shares are trading on lower than average multiples and offer one of the more generous dividend yields on the local market.
At present Westpac's shares are changing hands at just over 11x earnings, which is notably lower than its average over the last decade of 13x earnings. And while a lower PE ratio may be justified due to its softer growth outlook, I feel this discount is too large.
One positive, though, is that it does mean Westpac's shares currently provide a trailing 7% dividend yield. Which is hard to beat on the market at the moment and very attractive in this low interest environment.
Which other banks should you buy?
Although I think that all four of the big banks are in the buy zone right now, my preference remains Australia and New Zealand Banking Group (ASX: ANZ) and then National Australia Bank Ltd (ASX: NAB).
The reason I have a preference for ANZ is due to its cost cutting opportunities, low bad debts, and its exposure to a business lending market which is growing at a solid rate. I think this has positioned it better than the rest of the group for solid earnings growth in FY 2019 and FY 2020. Another bonus is the fact that its shares currently offer a trailing fully franked 5.9% dividend.
