Although it is on course to end the day lower, at one stage today the Westpac Banking Corp (ASX: WBC) share price was pushing higher.
In fact, the banking giant's shares were pushing so high they climbed to a 52-week high of $25.28.
Why is the Westpac share price at a 52-week high?
Investors have been scrambling to buy Westpac shares since the release of its first quarter update last month. And it isn't hard to see why.
For the three months ended 31 December, Australia's oldest bank reported a $1.97 billion first quarter cash profit. This was more than double the quarterly average cash earnings of $808 million it recorded during the second half of FY 2020.
Even when adjusting for notable items, Westpac's growth was impressive. The bank's normalised first quarter cash earnings were up 54% over the second half average.
Those normalised earnings exclude the positive impact of a COVID impairment reversal.
Westpac reported an impairment benefit of $501 million for the three months. This was due to improved credit quality, stronger economic outcomes, and a better economic outlook.
It noted: "While uncertainty remains around the impact of local COVID outbreaks, there is cause for optimism. The economy is recovering, consumer and business confidence is strong, and the labour market has been much more resilient than expected."
What else is driving the Westpac share price higher?
Also giving the Westpac share price a lift was the reaction to its update by the broker community. The likes of Citi, Goldman Sachs, and Morgans have buy ratings on the bank's shares, to name just three.
Morgans is arguably the bullish of them all and currently has an add rating and $27.50 price target on the bank's shares.
Based on this, the Westpac share price could soon be making a new 52-week high. This price target implies potential upside of approximately 11% over the next 12 months.
Positively, Morgans is also forecasting a fully franked 5% dividend yield on top of this.
This could make it one to consider if you haven't already got meaningful exposure to the banking sector.
