The team at Bell Potter has been busy this week looking at its top ASX share picks for 2022.
On this occasion, I’m going to look at what the broker is saying about the banking sector. Here are its top picks in the sector:
Which ASX bank shares are buys?
Bell Potter notes that its top picks in the sector possess proven risk management capabilities, defensive qualities, strong growth prospects, and health balance sheets. The latter includes surplus capital that could eventually be returned to shareholders.
Those top picks are Australia and New Zealand Banking GrpLtd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB). The broker has a buy rating and $30.00 price target on ANZ’s shares and a buy rating and $31.00 price target on NAB’s shares.
Based on the current ANZ share price, this implies potential upside of 9.2%. Whereas based on the latest NAB share price, Bell Potter’s price target suggests upside of 9%.
Don’t forget the dividends
The broker is expecting the banks to provide attractive fully franked dividend yields next year. Its analysts are forecasting a fully franked 4.7% yield for ANZ’s shares and a fully franked 5.1% yield for NAB’s shares.
This brings the total return on offer for both bank shares to approximately 14% over the next 12 months.
Bell Potter Analyst TS Lim, commented: “Our 2022 top picks once again possess proven risk management capabilities, defensive qualities including healthy balance sheets and surplus capital that could be returned to shareholders in due course, and strong growth prospects.”
“These companies have undergone massive transformation since the GFC to improve earnings quality and consistency. Our selection comprises two major banks. The longer term operating environment post COVID-19 remains positive for ANZ and NAB. Both are well-provisioned and well-placed to capitalise on post-pandemic opportunities in retail and SME banking,” Lim added.
The post Leading broker names the ASX bank shares to buy in 2022 appeared first on The Motley Fool Australia.
Should you invest $1,000 in NAB right now?
Before you consider NAB, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and NAB wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
*Returns as of August 16th 2021
More reading
- What is the outlook for the ANZ (ASX:ANZ) share price in 2022?
- December has been a great month so far for the NAB (ASX:NAB) share price
- Could the CBA share price peak have been and gone?
- 2 ASX 200 dividend shares to buy
- 5 things to watch on the ASX 200 on Friday
Motley Fool contributor James Mickleboro 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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