The National Australia Bank Ltd (ASX: NAB) share price slumped 5.4% lower yesterday but is the ASX bank now in the buy zone?
Why the NAB share price slumped lower yesterday
Alongside the NAB shares sliding in yesterday's trade, the S&P/ASX 200 Index (ASX: XJO) dropped 3.1%. The benchmark ASX 200 index closed at 5,960.60 points.
I don't think there was a fundamental shift behind yesterday's ASX bank move although, according to reporting in the Australian Financial Review (AFR), not all investors are bullish on the ASX banks in 2020.
It's worth noting the NAB share price opened up 5.1% on Tuesday and led the ASX 200 higher.
Yesterday's slump could simply be investors closing out positions and netting some tidy gains. After all, NAB's value has rocketed 37.4% since bottoming out in the bear market on 23 March.
Is NAB a cheap ASX bank share to buy today?
After NAB's price fall yesterday, it's now down more than 33% from its 52-week high of $30 per share.
NAB does have a large business banking segment which does create some headaches for investors. I think whether NAB is cheap depends on how you view the business's recovery in 2020 and 2021.
Restrictions are starting to ease which is good news for the economy and corporate earnings. If NAB's debtors continue to pay their loans then the Aussie bank's earnings could surprise the market in October or November.
However, there's plenty of uncertainty remaining in the economy. One of the big question marks is how the removal of the current government stimulus measures will impact on the Aussie economy.
I think there could still be long-term value in the NAB share price at $19.07 per share. The ASX banks have historically been strong dividend shares and I think that will continue in 2021 and beyond.
Foolish takeaway
Yes, the NAB share price slumped lower yesterday but the trend in the past few months has been upward. That could mean there's a chance to buy for a good price if you're a buy and hold investor looking at the decades ahead.
