The Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price has underperformed the S&P/ASX 200 Index (ASX: XJO) this year, but does its dip place the dividend-paying bank in the buy zone?
Some experts are bullish on both the company’s stock and its dividends in the future.
Right now, shares in ANZ are trading at $23.90 apiece. That’s 13.97% lower than they were at the start of 2022. Meanwhile, the ASX 200 has dumped 12.15% over the course of this year so far.
Could the smallest of the big four banks offer 21% upside and growing dividends? That’s what one broker is tipping.
Are ANZ shares an ASX 200 dividend buy?
There’s a lot going for ANZ shares, and the bank’s dividends, right now if experts are to be believed.
Baker Young managed portfolio analyst Toby Grimm flagged the stock as a buy last week, saying, courtesy of The Bull:
Compared to the other three major banks, ANZ shares were recently trading on the lowest price-to-earnings (P/E) multiple and offer the highest prospective dividend yield.
The big bank has offered investors $1.44 per share in dividends over the last 12 months. That leaves ANZ shares with a 6% dividend yield.
Additionally, it posted 223.8 cents of earnings per share (EPS) over the 12 months ended 31 March, meaning its P/E ratio currently sits at around 10.7x.
And it could be on the path to further improvement. Citi expects the company to grow its earnings over the coming financial years on the back of rate hikes, my Fool colleague James reports.
It also tips ANZ to pay out $1.56 per share in fully franked dividends in financial year 2023.
That would see its stock trading with a 6.5% yield at its current price.
Topping it off, Citi has slapped ANZ shares with a buy rating and a $29 price target, meaning the stock could offer investors a 21% return, plus any dividends. That’s certainly nothing to scoff at.
The post Are ANZ shares an ASX 200 dividend buy right now? appeared first on The Motley Fool Australia.
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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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