Analysts are speculating over which direction National Australia Bank Ltd (ASX: NAB) share price could be heading in the coming period.
The major bank’s stocks have gone sideways in the past month, down 0.18%.
But this week NAB reported its intentions to hire more staff to grow its private banking and wealth management businesses.
Three of the big banks, including NAB, will report their results in a few weeks.
Does that mean now is a buying opportunity for NAB shares?
Is a dividend boost coming for NAB shareholders?
Redpoint Investment Management senior portfolio manager Max Cappetta told The Motley Fool that he certainly favoured it over 2 other major banks.
“Our expectations are showing that their profitability looks to be rebounding more strongly.”
Goldman Sachs is forecasting that NAB will pay out a total dividend of 125 cents per share for the 2021 financial year.
As it has already given out 60 cents as an interim dividend, this would mean an 8.3% lift for the final dividend to bring it to 65 cents.
“When calculating against the current share price, NAB is trailing on a forecast fully-franked dividend yield of 4.4%,” reported The Motley Fool’s Aaron Teboneras.
“Before the onset of COVID-19, the bank had been paying shareholders fully franked dividends of 99 cents on a bi-annual basis.”
As for the price itself, Goldman Sachs has rated NAB shares a ‘buy’ with a price target of $30.62. That’s a nice 11.4% premium to Tuesday’s closing price.
Possible dangers for NAB shares
All bank ASX shares are currently facing the danger of a deflating housing market.
Property prices have ramped up the past 18 months on the back of historic low interest rates, and there are worries the market has overheated.
Morgan Stanley last week raised concerns about the high levels of household debt in Australia.
And this week treasurer Josh Frydenberg agreed, flagging that tighter lending regulations could come in to curb massive home loans.
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Motley Fool contributor Tony Yoo 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 Bruce Jackson.
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