Could the ANZ share price really offer more than 20% upside?

One top broker has tipped a bright future for the Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price.

In fact, it’s slapped the S&P/ASX 200 Index (ASX: XJO) banking giant’s stock with a price target representing a potential 22% upside.

At the time of writing, the ANZ share price is $24, 0.42% higher than its previous close.

For context, the ASX 200 is down 0.75% right now while the S&P/ASX 200 Financials Index (ASX: XFJ) has slumped 0.54%.

So, what does top broker Credit Suisse see in the ANZ share price? Let’s take a look.

Broker tips ANZ share price to take off

ANZ shares have been tipped to surge around 22% to trade at $29.25, marking a notable upside on their current price. And the broker believes rising interest rates will be the driver of such a gain.

Credit Suisse believes ANZ will be an early beneficiary of consecutive (and anticipated) interest rate hikes, my Fool college James Mickleboro reports. The broker is also said to like ANZ’s exposure to business banking.

The RBA upped interest rates for a fourth consecutive month in August, bringing the official cash rate to 1.85% in a bid to tackle inflation.

Rising rates can bring both good and bad tidings for bank stocks.

It provides institutions with the chance to up rates charged on loans, thereby increasing net interest margins (NIMs) and, thus, profits. However, it can also increase the risk of foreclosures and bad debts.

But Credit Suisse isn’t alone in expecting big things from the smallest ‘big four’ bank. Citi has slapped the ANZ share price with a target of $29, Mickleboro reported last month.

It comes after the stock plunged 21% over the first half of 2022. It’s currently trading 12.06% lower year to date.

The post Could the ANZ share price really offer more than 20% upside? appeared first on The Motley Fool Australia.

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More reading

• Why did the ANZ share price have such a stellar run today?
• Here are the top 10 ASX 200 shares today
• ‘It’s a bit unfair’: Here’s why ANZ shares are making news this week
• ANZ share price unfazed amid bank’s latest move to finance decarbonisation
• Here is the RBA interest rate outlook according to ASX 200 banks

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Brooke Cooper 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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