ANZ Group Holdings Ltd (ASX: ANZ) shares have been in fine form in 2024.
Since the start of the year, the banking giant's shares have smashed the market with a gain of 15%.
As a comparison, the ASX 200 index is up 5% year to date.
The big question for investors is what's next for this high-flying bank stock? Especially with its shares trading within touching distance of their multi-year high of $30.23.
So, let's see what analysts are saying about this big four bank.
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What's next for ANZ shares?
Analysts at Goldman Sachs have been running the rule over the bank's quarterly update. The good news is that they were pleased with what they saw. The broker said:
ANZ released its 3Q24 Pillar 3 disclosure for the quarter ended 30-Jun-24. ANZ reported a 3Q24 provision charge of A$45 mn, which was better than what was implied by prior 2H24 forecasts, and we note that while asset quality has continued to normalize, it still remains remain better than 2020 levels across a number of metrics. ANZ's balance sheet continues to grow with net loans and advances 3% higher, and customer deposits up 2%. 3Q24 CET1 ratio of 13.3% (12.0% pro-forma) had been pre-announced.
In light of this, the broker has reiterated its buy rating on the company's shares. It explains:
We reiterate our Buy rating on ANZ, given i) we continue to see evidence of ANZ's ability to derive productivity benefits (A$201 mn in 1H24) and management noted that there remains a large pipeline available which can be used to offset cost inflation. Furthermore, ii) we see upside for Group returns due to accretive mix shifts in the Institutional business towards higher ROE Payments and Cash Management business, and iii) our sector level analysis of institutional lending spreads (here) suggests a NIM tailwind into 2H24, which bodes well for ANZ given its relative skew towards institutional banking. Finally, the stock still trades at a c. 36% PER discount to the sector versus a 15-yr average discount 14%.
However, it is worth noting that Goldman's improved price target of $29.48 is actually below where ANZ shares currently trade. This could mean it is better for investors to sit tight and wait for a pullback before making an investment.
Though, analysts at UBS don't believe investors should keep their powder dry. They responded to the quarterly update by upgrading the bank's shares to a buy rating with a $32.00 price target.
This implies potential upside of almost 7% for investors. And if you add in dividends, the total return stretches to approximately 12%.
