Buy ANZ shares today for 16% upside: broker

These brokers reckon ANZ shares could still be undervalued…

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It's been a rather lousy start to the week for ASX shares and the S&P/ASX 200 Index (ASX: XJO) so far this Monday. At present, the ASX 200 has lost 0.33%, dragging the index down to just under 7,410 points. But the ANZ Group Holdings Ltd (ASX: ANZ) share price seems to be holding up reasonably well.

ANZ shares are also down today. But not by as much as the broader market. At the time of writing, the ANZ share price is trading at $25.67 a share, down by 0.16% so far.

But that's not nearly enough to put a real dent in the strong start ANZ has had to the year. This ASX 200 bank share is now up a healthy 11.65% year to date in 2023 so far. ANZ shares have now risen more than 22% since the bank's last 52-week low, which we saw back in June last year.

But what's next for the ANZ share price? Could these gains keep coming for investors?

Well, let's check out what an ASX expert reckons.

ASX broker names ANZ shares as a buy

Brokers at Citi have recently taken a look at the ANZ share price and liked what they saw. As we looked at last week, Citi gave the ASX bank share a buy rating, complete with a 12-month share price target of $29.95. If realised, that would give investors a further upside of almost 17% from where the shares are today.

Citi was excited with what ANZ had to say in its latest quarterly update that we saw last week. This showed ANZ's home loans and deposits rising in value, while impairments dropped by 22%.

So that's one broker's opinion.

But Citi isn't the only one eyeing off ANZ shares today. As we also covered last week, fellow ASX broker Goldman Sachs is another expert who is liking what it is seeing with ANZ shares of late.

This broker doesn't have a buy rating on ANZ right now. But its hold rating comes with a share price target of $27.23. That would still see a potential upside of just over 6% from where the shares are today, if realised.

Here's some of what Goldman said about ANZ's update last week:

Overall the update was slightly stronger that what was implied by prior 1H23 forecasts, driven by better volumes and asset quality remaining strong.

If these brokers are on the money, ANZ shares could give investors some meaningful capital appreciation over the coming 12 months. And that would be on top of ANZ's hefty dividend, which is currently sitting at a trailing yield of 5.65%.

So we'll have to see what's in store for the ANZ share price going forward. But these ASX brokers are certainly optimistic.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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