The National Australia Bank Ltd. (ASX: NAB) share price rocketed to a multi-year high of $33.29 yesterday.
This is a stark contrast to when its shares were trading at a multi-decade low in March 2020. The steep fall was brought on by the COVID-19 pandemic which investors feared a deep recession.
Nonetheless, NAB shares have zoomed upwards since, creating wealth for investors who bought and held on during the tumultuous period.
Below, we calculate how much you would have made if you’d bought $5,000 worth of NAB shares since the COVID-19 crash.
How much would you have if you’d invested $5,000 since the COVID-19 crash?
If you’d invested $5,000 into NAB shares on 23 March, you would have picked them up for approximately $13.195 apiece. This equates to about 378 shares without topping up along the way.
Looking at yesterday’s closing price, the NAB share price finished at $33.25. This means that those 378 shares would now be worth $12,568.50.
Not a bad effort — almost doubling your initial investment in what is arguably one of ASX’s most safe and reliable companies.
When looking at percentage terms, this implies an average yearly return of a whopping 55.96%.
In comparison, investing the same amount in an ASX 200 index-tracking fund would have netted you $8,320.72.
What about the dividends?
Over the course of the last two years, NAB has made a total of 4 dividend payments from July 2020 to December 2021.
Adding up those 4 dividends payments gives us an amount of $1.87 per share. Calculating the number of shares owned by the total dividend payment gives us a figure of $706.86.
When putting both the initial investment gains and dividend distribution, an investor would have $13,275.36 worth of NAB shares.
NAB share price summary
Over the past 12 months, NAB shares have surged by 25% higher following positive investor sentiment in the banking industry. With the Reserve Bank of Australia looking to hike interest rates, this could lead to a stronger profit for NAB.
NAB has a price-to-earnings (P/E) ratio of 17.95 and commands a market capitalisation of roughly $107 billion.
The post If you’d invested $5,000 in NAB shares just after the COVID crash, here’s what you’d have now 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 over 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 January 13th 2022
More reading
- Should investors buy the NAB share price at its 52-week highs?
- NAB share price lifts again to hit new 4-year high
- Do CBA shares offer the highest big bank dividend yield?
- Why are ASX 200 bank shares having such a stellar start to the week?
- 3 ASX 200 shares starting the week with new 52-week highs
Motley Fool contributor Aaron Teboneras 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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