Why did the Westpac share price lag the ASX 200 in November?

The Westpac Banking Corp (ASX: WBC) share price struggled to gain ground amid the market’s November rally.

That’s despite the S&P/ASX 200 Index (ASX: XJO) bank share posting its full-year earnings last month.

After closing October at $24.11, the stock hit a high of $24.50 in early November and a low of $23.06 just days later, before closing the month at $23.77. That marks a 1.41% fall over the 30-day period.

Comparatively, the ASX 200 lifted 6.13% last month while the S&P/ASX 200 Financials Index (ASX: XFJ) gained 1.14%.

So, what went wrong for the big four bank stock in November? Let’s take a look.

What weighed on the Westpac share price last month?

There was only one thing directly impacting the Westpac share price last month. And boy, was it a doozy.

The bank released its earnings for the 12 months ended 30 September on 7 November.

It posted a $5.7 billion profit – a 4% year-on-year increase; $5.3 billion of cash earnings – a 1% fall; and a 64-cent dividend.

That brought Westpac’s dividends for financial year 2022 to $1.25 per share – marking a 6% improvement.

At the same time, however, its net interest margin slumped 17 basis points to 1.87% despite rising rates.

The bank’s New Zealand segment posted notable growth, with its cash earnings lifting 15% to $1.2 billion. However, that was partially offset by its business segment’s 15% decline in cash earnings, coming in at $918 million.

Of course, its bottom line was also dinted by the previously forecast $1.3 billion impact from notable items, mainly brought about by the sale of its life insurance business.

The bank’s stock tumbled 4% on the back of its full-year results.

Fortunately, the Westpac share price is still able to boast a strong performance over the longer-term despite its November struggles.

It’s currently 11% higher than it was at the start of 2022 and 16% higher than it was this time last year.

For comparison, the ASX 200 has fallen 3% year to date and is 2% higher than it was 12 months ago.

The post Why did the Westpac share price lag the ASX 200 in November? appeared first on The Motley Fool Australia.

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More reading

• The 3 best-performing ASX 200 bank shares in November revealed
• The 10 ASX 200 shares responsible for 60% of all Aussie dividends last quarter
• If you bought $20,000 worth of Westpac shares this year, here’s how much dividend income you’d have
• Which ASX 200 bank share stands to benefit the most from ‘good borrowers’?
• These ASX dividend shares have 4%+ forecast yields

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 recommended Westpac Banking. 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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