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The Macquarie Group Ltd (ASX: MQG) share price is moving higher in morning trading today. Shares are currently changing hands at $188.47, a gain of 3.06%.

That marks a record high for Macquarie, whose shares have been on an extended bull run this past year.

What’s more, the banking giant has achieved this growth on its price chart in the absence of any market-sensitive news over the last month.

What’s fuelling the Macquarie share price lately?

The Macquarie share price began gaining ground last month after the company released an update on its near and medium-term outlook at the Jeffries Asia Forum.

Although it sees some meaningful headwinds in the short-term, looking further out, the company feels it is well-positioned to “deliver superior performance in the medium term”.

The news appeared important enough for investors to start bidding up the Macquarie share price, baking in its future earnings expectations to value the bank’s equity.

Momentum from the wider industry is also apparent in Macquarie’s case, with the S&P/ASX 200 Financials index (ASX: XFJ) also climbing into the green this past month.

However, Macquarie is leading the broad ASX financials index by a country mile, and there may be some other factors at play here – especially with its entrance into the green energy and renewables sector.

That’s what two leading brokers reckon anyhow, after their analysis on the company and its share price.

Can Macquarie keep gaining past its record high?

Analysts at investment banking giants JP Morgan and Morgan Stanley certainly believe so, particularly given their Australian counterpart’s moves into ‘green capabilities’.

Morgan Stanley’s analysts rate Macquarie as having one of the best ‘green’ mantras among listed financial companies worldwide.

As a result, it reckons Macquarie is about to have a period of accelerated earnings growth versus its peers, and that it should therefore command a “green premium” on its valuation multiples.

Morgan Stanley thinks Macquarie can grow its green revenue by 20-25% annually over the coming 5-year period.

The broker arrives at these conclusions from its own analysis, as it thinks “Macquarie’s critical scale in renewables should command a further green premium and reduce its cost of capital”.

As such, it raised its price target by 37% to $240, implying around 27% upside potential on today’s pricing.

Fellow market maker JP Morgan has also offered its opinion on the Macquarie share price.

The broker has a $190 price target on Macquarie shares and maintains its overweight rating to investors.

It too believes the bank can deliver high earnings growth, forecasting approximately 15% net profit after tax in FY22, and 15% return on equity from FY22–24 for the company.

Looking further ahead, it sees “the annuity divisions driving strong medium-growth, with MAM (Macquarie Asset Management) well placed to benefit from structural demand for alternative asset classes”.

It also feels Macquarie Investment Management will benefit from the acquisition of Waddell & Reed completed in FY21.

In any sense, both brokers are bullish on Macquarie shares and believe they have the legs to extend the bank’s run into the green much further into the future.

The Macquarie share price is up 34% this year to date and 41% in the past 12 months.

The post What leading brokers are saying about the Macquarie (ASX:MQG) share price appeared first on The Motley Fool Australia.

More reading

• Why did the Macquarie (ASX:MQG) share price have such a great FY22 first quarter?
• Is the Westpac (ASX:WBC) share price a buy for its 7% dividend yield?
• Why the Macquarie (ASX:MQG) share price hit its all-time high on Friday
• How did the Macquarie (ASX:MQG) share price perform in September?
• The most important catalyst for outperforming ASX shares: fund manager

The author Zach Bristow has no positions 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 owns shares of and has recommended Macquarie Group Limited. 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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The Macquarie Telecom Group Ltd. (ASX: MAQ) share price has been a top performer in 2021, up 45% year-to-date.

Macquarie Telecom’s outperformance has largely been attributed to a single-day jump in share price on 14 July, when the company announced plans to build a new data centre at the Macquarie Park Data Centre Campus. Its shares jumped 15.4% on the day of the announcement to $63.50.

The Macquarie Telecom share price continued to rally following the new data centre announcement, scoring an all-time high of $82.50 on 31 August.

From a fundamental perspective, the company has delivered sound growth with its FY21 full-year results reflecting a seventh consecutive year of EBITDA growth.

Looking ahead, the company said that it expects EBITDA to continue to grow in FY22, driven by its investments and performance in data centres, cloud services and government.

In an interview with Livewire, Investors Mutual’s Simon Conn and Montgomery Investment Management’s Roger Montgomery shared with investors companies that have a solid growth outlook.

Why there could be more upside to the Macquarie Telecom share price

Montgomery pitched Macquarie Telecom when asked to pick a company that is a “strong candidate for an earnings upgrade.”

“We think the market doesn’t appreciate how they make their money from selling their volume. They often sell a large part of their available power, if you like, at a lower price. But they can make just as much money – they can actually double their revenue and their EBITDA – from selling the last 10% of the volume at 10 times what they sold the original 90% for.”

“I don’t think that’s widely appreciated. So we’ve got valuation on the stock of over $100, and its recent weakness gives, I think, us and other people an opportunity to buy,” he added.

The Macquarie Telecom share price has been trading sideways since early August, around the mid $70 level.

The post Why this broker sees a 30% upside in the Macquarie Telecom (ASX:MAQ) share price appeared first on The Motley Fool Australia.

More reading

• Bitcoin price to half a million US dollars? Why ARK’s Cathie Woods is doubling down
• Why the Pendal (ASX:PDL) share price is sinking 9% today
• Qantas (ASX:QAN) share price rises after $800 million land sale agreement
• Could the A2 Milk (ASX:A2M) share price hit $8 by the end of 2021?
• IAG (ASX:IAG) share price on watch as ASIC launches legal action

Motley Fool contributor Kerry Sun 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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The Bitcoin (CRYPTO: BTC) price is up 7% over the past week and flat over the past 24 hours. One Bitcoin is currently worth US$57,564 (AU$77,789).

That, according to data from CoinMarketCap, gives the world’s first and biggest crypto a market cap just north of US$1.08 trillion dollars. It also means Bitcoin represents some 45% of the total global crypto market in terms of value.

With the digital token again closing in on its all-time highs of more than US$64,863, some crypto bulls are eagerly eyeing the US$100,000 level.

Others, like Cathie Wood, the founder of asset manager ARK Invest, believe it will run far higher.

All the way to US$500,000.

Bitcoin price to US$500,000?

It’s not the first time Woods has made this prediction for the Bitcoin price. She’s a long-term avowed Bitcoin bull.

ARK not only owns Bitcoin in its portfolio, the asset manager is hoping to launch a futures-based Bitcoin exchange traded fund (ETF) in the United States. To date the US Securities and Exchange Commission (SEC) has yet to greenlight any crypto related ETFs. But the SEC is considering the matter.

So how does Woods see the Bitcoin price soaring another 770% from here?

Speaking at the CFA Societies of Australasia conference yesterday, Woods said (quoted by the Australian Financial Review):

I have seen two periods in my investment life where what seemed like new asset classes were moving into institutional portfolios. Real estate in the 70s and 80s and emerging markets…

If institutions around the world were to allocate 5 per cent of their portfolios to bitcoin, that allocation alone, and this is just one of many use cases out there, would add roughly $500,000 to bitcoin’s price.

To be clear she’s talking about US dollar prices here. Meaning a forecast Bitcoin price of AU$675,000.

Woods doubled down on her prediction saying, as the AFR summarises, that it doesn’t even take into account “the potential for large corporations like Square, MicroStrategy, and Tesla to allocate more of their balance sheet holdings to bitcoin instead of cash”.

Proceed with caution

If Woods is right about the direction of the Bitcoin price, ARK and other Bitcoin investors stand to make some heady gains.

But don’t forget that just one year ago today, on 15 October 2020, Bitcoin was trading for US$11,500.

Go back a little further, to 12 March 2020, and the Bitcoin price was as low as US$4,900. That came during the global market selloff following the initial pandemic panic, indicating the token was far from immune from forces impacting the wider asset markets.

Never invest more than you can afford to lose.

The post Bitcoin price to half a million US dollars? Why ARK’s Cathie Woods is doubling down appeared first on The Motley Fool Australia.

More reading

• ASX set to welcome first cryptocurrency ETF… but there’s a catch
• What happened to the Bitcoin price in the FY22 first quarter?
• Are NFTs a bubble awaiting a pin or the next big investment theme?
• Here’s what happened to the Bitcoin price in September
• How these top 3 cryptos performed in the first quarter of FY22

Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin, Microsoft, Square, and Tesla. 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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The Pendal Group Ltd (ASX: PDL) share price is on course to record a sizeable decline on Friday.

In early trade, the fund manager’s shares are down 9% to $7.05.

Why is the Pendal share price sinking?

Investors have been selling down the Pendal share price on Friday following the release of its latest funds under management (FUM) update.

As you might have guessed from the share price weakness, Pendal’s FUM update was a touch disappointing.

At the end of September, the company had total FUM of $139.2 billion. While this was an increase of 30.5% over the $106.7 billion FUM it reported at the end of June, this increase was driven by favourable foreign exchange and market movements and the acquisition of Thompson, Siegel & Walmsley.

Pendal actually reported net fund outflows of $2.3 billion during the three months.

Management commentary

Pendal’s CEO, Nick Good, commented: “The acquisition of Thompson, Siegel & Walmsley LLC (TSW), delivered a step-change in FUM from $106.7 billion to $139.2 billion. For shareholders this is proving to be a value accretive acquisition.”

Mr Good also explained why Pendal experienced its net fund outflows during the quarter.

”There was significant volatility in client sentiment leading to re-balancing of portfolios and profit taking, giving rise to outflows in a range of channels and strategies,” he said.

Nevertheless, the CEO appears confident in the direction the company and its investments are heading.

He concluded: “At Pendal we are anchored by our high-conviction investment philosophy, which means we invest through the cycles to deliver superior long-term value and performance for our clients. The continued diversification of our business supports growth in FUM and shareholder returns.”

Pendal will be releasing its full year results for FY 2021 next month on 5 November.

The post Why the Pendal (ASX:PDL) share price is sinking 9% today appeared first on The Motley Fool Australia.

More reading

• Qantas (ASX:QAN) share price rises after $800 million land sale agreement
• Could the A2 Milk (ASX:A2M) share price hit $8 by the end of 2021?
• IAG (ASX:IAG) share price on watch as ASIC launches legal action
• Treasury Wine (ASX:TWE) share price on watch after first-quarter update
• Here’s what the ASX futures are pointing towards today

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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The Qantas Airways Limited (ASX: QAN) share price is in the green on Friday morning, trading 3.94% higher to $5.80.

This morning, the national carrier announced it had agreed to sell its surplus land in Mascot, New South Wales to strengthen its balance sheet and pay down debt.

What did Qantas announce?

The Qantas share price is gaining after the airline entered into a binding agreement with a consortium led by LOGOS Property Group, one of Asia Pacific’s leading logistics property groups.

LOGOS will be acquiring 13.8 hectares of land in Mascot for $802 million.

The transaction is subject to some unspecified conditions. However, the vast majority of the lots is expected to settle in the first half of this financial year.

Qantas said it will provide further details on the expected financial benefit of the sale in its half-year results in February 2022.

In addition, Qantas advised it has entered into discussions with LOGOS about potential future development options on the land they are acquiring.

Qantas expects the evaluation of these proposals to be completed in early 2022, with the potential to raise the total value of today’s deal to more than $1 billion.

According to the release, the sale of the largely underdeveloped land follows a three-month period of expressions of interest. During this time, Qantas received 18 bids from a range of Australian and international syndicates.

Qantas ultimately decided “there is no long-term need for Qantas to develop the land, which is largely surplus to its operations”.

The proceeds from the sale will be used to pay off debt.

Management commentary

CEO Alan Joyce commented on the transaction possibly fuelling the Qantas share price today:

We went into this process open-minded about whether we’d sell some, all, or none of this land depending on the response from the market. That response was extremely strong and it has resulted in the sale of all the land.

We’ll use these funds to help pay down debt that we’ve built up during the pandemic. The strength of this sale and its impact on our balance sheet means we can get back to investing in core parts of our business sooner.

Joyce said Qantas could work with LOGOS for additional redevelopment plans.

Beyond the deal we’re announcing today, there’s potential for us to work with LOGOS on creating a Qantas Precinct as part of their redevelopment plans for the site. It could see a new headquarters combined with a relocated training centre and distribution hub, right next to the airport, rather than being spread across different parts of Mascot as they are now.

Qantas share price nears 20-month highs

Qantas and the broader travel industry were quick to re-rate amid hopes international borders could reopen as soon as November.

The Qantas share price is up 30% since late August, trading at similar levels as early March 2020.

The post Qantas (ASX:QAN) share price rises after $800 million land sale agreement appeared first on The Motley Fool Australia.

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• Why this top broker is bullish on the Qantas (ASX:QAN) share price
• NSW cash splash, business confidence up, Qantas (ASX:QAN) down on Bonza news. Scott Phillips on Nine’s Late News
• Qantas (ASX:QAN) share price lifts despite Clive Palmer sell-off
• Qantas (ASX:QAN) share price falls amid new budget airline competition
• Will the Qantas (ASX:QAN) share price follow Ryanair’s surge on reopening?

Motley Fool contributor Kerry Sun 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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It certainly has been a disappointing year for the A2 Milk Company Ltd (ASX: A2M) share price.

Despite a strong rally this week, the infant formula company’s shares are down 41% in 2021 at $6.86.

Could the A2 Milk share price reach $8.00 by the end of the year?

One leading broker that believes the A2 Milk share price weakness in 2021 is a buying opportunity is Bell Potter.

According to a recent note, the broker has retained its buy rating and $7.70 price target on the company’s shares.

Based on the current A2 Milk share price, this implies potential upside of 12% for investors.

What did the broker say?

Bell Potter has been looking at recent industry and export data and appears optimistic that things are improving in the infant formula market.

Commenting on Australia-China exports, which are a Daigou proxy, the broker said: “Industry volumes rose +5% YOY in Aug’21, the second positive YOY outcome in the past four months. Volumes have been volatile in recent months, but in general terms are demonstrating signs of picking up from the lows seen in 2Q-3Q20. On a R3M basis, volumes are up +42% from the Jan’21 low.”

In addition to this, the broker felt that the A2 Milk share price was trading at an undemanding level. And while it has since rallied this week following a positive update from smaller rival Bubs Australia Ltd (ASX: BUB), Bell Potter is likely to still feel the same way given the potential upside on offer.

It commented: “There is no change to our Buy rating, earnings forecasts or A$7.70ps target price. In recent months we have seen a bottoming in trade flows into China and closer alignment of trade flows into and out of Australia. Trading at 14.3x FY22e EBITDA exMVM/US losses we don’t see A2M as particularly demanding relative to other China facing FMCG entities.”

All in all, the broker appears to see potential for the A2 Milk share price to be trading close to $8.00 at the end of the year. A strong update at its investor event later this month or AGM next month could play a key role in that.

The post Could the A2 Milk (ASX:A2M) share price hit $8 by the end of 2021? appeared first on The Motley Fool Australia.

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• These 3 ASX 200 shares are topping the volume charts this Thursday
• Why A2 Milk, HUB24, Netwealth & Perseus shares are storming higher
• Why is the A2 Milk (ASX:A2M) share price leaping again today?
• ASX 200 (ASX:XJO) midday update: HUB24 & Netwealth impress, A2 Milk surges again
• Why did the A2 Milk (ASX:A2M) share price have such a great FY22 first quarter?

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 recommended A2 Milk and BUBS AUST FPO. 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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The Insurance Australia Group Ltd (ASX: IAG) share price is in the spotlight this morning as the Australian Securities and Investments Commission (ASIC) takes the company’s subsidiary to court.

ASIC has launched civil proceedings against Insurance Australia Limited, owned by IAG, in the Federal Court.

The watchdog alleges Insurance Australia Limited misled customers by applying discounts while simultaneously upping premiums. It is alleged NRMA customers missed out on more than $60 million worth of discounts.

As of Thursday’s close, the IAG share price is $5.08.

Let’s take a closer look at IAG’s latest legal battle.

ASIC launches legal action against IAG

ASIC claims Insurance Australia Limited increased the premiums of some NRMA customers while adding loyalty and ‘no claim bonus’ discounts. Thus, it ensured customers’ overall premiums didn’t fall below a set level.

The watchdog believes at least 596,000 NRMA Home, Motor, Caravan, and Boat Insurance customers were affected by the behaviour between March 2014 and September 2019.

IAG self-reported the seemingly deceptive behaviour to ASIC after a 2019 internal review identified it. The company is working to return a total of $377 million to affected customers. In a release to the ASX this morning, IAG stated:

IAG apologises for this failure, recognises the significance and that this was unacceptable, and is putting this right for its customers as soon as possible.

IAG is far from the only insurance company to be found not providing promised discounts. ASIC’s deputy chair, Sarah Court, commented:

This follows industry-wide failures that have led to insurers repaying more than $400 million to over 2 million home, car, and other insurance customers since 2018. All insurers should take urgent steps to ensure they can and do meet the pricing promises they make.

On top of NRMA, Insurance Australia Limited issues insurance through brands including CGU, RACV, and Coles Group Ltd (ASX: COL) Insurance.

IAG share price snapshot

Right now, the IAG share price is 7% higher than it was at the start of 2021. It has also gained 6% since this time last year.

The post IAG (ASX:IAG) share price on watch as ASIC launches legal action appeared first on The Motley Fool Australia.

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• Could the IAG share price hit $6 by the end of 2021?
• Why Ampol, Fortescue, IAG, & Perenti shares are charging higher
• ASX 200 (ASX:XJO) midday update: Star shares crash, tech shares tumble
• IAG (ASX:IAG) share price lifts after Federal Court makes judgement
• 2 ASX 200 shares surging this week despite inflation worries

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 owns shares of and has recommended COLESGROUP DEF SET and Insurance Australia Group Limited. 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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The Treasury Wine Estates Ltd (ASX: TWE) share price could be a mover on Friday after the company announced its first-quarter trading update for FY22.

Why the Treasury Wine share price is on watch

Treasury Wines flagged that trading channel conditions in the first quarter were slightly below expectations for a recovery.

The company pointed to segments such as wholesale in Asia and on-premise in the Americas as below expectations. It described these markets as “generally open, but with disruptions”.

The on-premise market in Australia and New Zealand was also below expectations. This segment was flagged as closed or significantly disrupted.

Despite the disruptions, Treasury Wine said its underlying divisional execution and overall trading performance was in line with expectations.

The company’s Penfolds segment experienced continued momentum in key growth markets, including Asia (excluding China).

Treasury Wine’s premium brands portfolio delivered an improvement in net sales revenue (NSR). This was underpinned by the introduction of new products in Australia and growing ahead of the market in the United Kingdom.

Treasury Americas continues to build momentum having made a number of changes to its business model and portfolio. The company advised that its Ten portfolio continues to outperform, growing 3% compared to a broader category decline of 5%.

Management commentary

Treasury Wine’s CEO Tim Ford was cautious in his commentary for FY22.

… the recovery of key luxury channels impacted by the pandemic are slightly behind the expectations we had at the beginning of the year.

This is particularly the case in the US where re-openings continued at a gradual pace, but with on-premise depletions growth slower than we had anticipated, and in Australia, where extended lockdowns in Sydney and Melbourne have resulted in the closure of the on-premise channel, delaying our execution plans outside of the large retailers, particularly for Penfolds. In Asia, significant disruptions to key luxury sales channels continue across large parts of the region.

Ford also flagged moderating sales growth across key sales channels.

… retail and e-commerce channels continue to perform strongly, albeit with moderating growth rates compared to the prior year where there were significant shifts in consumer purchasing behaviour.

Treasury Wine share price snapshot

The Treasury Wine share price has been trading sideways since early June, hovering around the low $12.00 level.

Despite the lack of recent traction, Treasury Wine shares are up 28.4% year-to-date, driven by a solid rally taking place between May through to August.

The post Treasury Wine (ASX:TWE) share price on watch after first-quarter update appeared first on The Motley Fool Australia.

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• Why is the Treasury Wine (ASX:TWE) share price in the green today?
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• Treasury Wine (ASX:TWE) share price lifts following sustainability update
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Motley Fool contributor Kerry Sun 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 owns shares of and has recommended Treasury Wine Estates Limited. 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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All eyes are on the Australian share market for Friday after US markets posted large rises. This follows a strong start to the US earnings season. Investor sentiment was positive as third-quarter results flowed from companies such as Bank of America, Wells Fargo, Citi, Dominos, and Morgan Stanley.

It appears Australian shares will follow in tow, with S&P/ASX 200 Index (ASX: XJO) futures indicating a 0.55% move higher to 7366.9 points.

What happened overnight?

The S&P 500 quickly rose after opening overnight after a flurry of earnings reported on Wall Street. Investors were treated to the biggest rally in the US market since March as a number of earnings exceeded expectations.

For instance, financial services giant Wells Fargo & Co (NYSE: WFC) posted a 60% increase in profits, with revenue topping expectations. This was a commonality among many US companies that reported overnight, instilling optimism in the market. Consequently, optimism among investors has spilled over to ASX futures on Friday.

At the end of the US session, the S&P 500 finished 1.71% higher. Meanwhile, the Nasdaq Composite and Dow Jones Industrial Average climbed 1.73% and 1.56% respectively. Pulling these indexes higher were some of the bigger financial services companies in the United States. These included a 4.5% gain in Bank of America Corp (NYSE: BAC), a 2.5% rise in Morgan Stanley (NYSE: MS), and a 2.4% rally in Charles Schwab Corp (NYSE: SCHW).

Bank of America said Thursday its third-quarter earnings rose to $7.7 billion, or 85 cents a share, from $4.9 billion, or 51 cents a share, in the year-ago period. Revenue increased to $22.8 billion from $20.3 billion. https://t.co/mh9esD32jh pic.twitter.com/gjutPIDk4L

— MarketWatch (@MarketWatch) October 14, 2021

https://platform.twitter.com/widgets.js

Commenting on the performance overnight, Oanda senior market analyst Edward Moya said:

The banks painted a strong and healthy picture of the US consumer. Wall Street can’t turn negative on the economy after seeing reserve releases, moderating trading revenue, mixed loan growth, and a consumer willing to take on debt.

Meanwhile, ASX futures are pointing higher despite Rio Tinto Limited (ASX: RIO) cutting its iron ore production guidance on Friday morning. The mining giant shared this information in its quarterly update this morning.

Moving ASX futures today

Aussie energy shares will be in the spotlight again today as the price of oil continues to ascend. According to Bloomberg, the price of WTI crude oil per barrel is now US$81.36. As a result, companies such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) will be in focus.

On top of this, gold miners will likely have their fair share of attention today as the price of the precious commodity inched higher overnight. The spot gold price gained 0.2% to US$1,798.9 an ounce as inflation fears circle.

For the full list of what is ahead on Friday, check out our other article, summarising the ASX markets.

The post Here’s what the ASX futures are pointing towards today appeared first on The Motley Fool Australia.

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• 3 reasons why the Brickworks (ASX:BKW) share price could be a buy
• 5 things to watch on the ASX 200 on Friday
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Charles Schwab is an advertising partner of The Ascent, a Motley Fool company. Bank of America is an advertising partner of The Ascent, a Motley Fool company. Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Charles Schwab and Domino’s Pizza. 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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The National Australia Bank Ltd (ASX: NAB) share price has been on form in 2021 and is up almost 25% year to date.

Despite this, one leading broker believes its shares still have room to climb higher.

Who is bullish on the NAB share price?

According to a note out of Goldman Sachs from last week, its analysts have retained their conviction buy rating and $30.62 price target on the bank’s shares.

Based on the current NAB share price of $28.58, this suggests that there is still 7.1% upside for investors.

And that isn’t including dividends. Goldman is forecasting a fully franked $1.40 per share dividend in FY 2022. This will mean a yield of 4.9%, which stretches the total potential return to 12% over the next 12 months.

What did the broker say?

The broker’s most recent note was in response to news that APRA is increasing bank loan serviceability expectations.

Positively, Goldman doesn’t expect these changes to have any meaningful impact on NAB or its peers.

It commented: “Overall, we are of the view that this increased serviceability buffer should have limited impact on housing credit growth, and we remain constructive on the banks, with four of the six listed retail banks on Buy (NAB (on CL), ANZ, WBC and BOQ). We also highlight our Buy on PPM, which has been explicitly excluded from the restrictions announced today.”

Why does Goldman like NAB?

Goldman has previously stated that it is bullish on the NAB share price due largely to its cost management initiatives.

It explained: “NAB’s cost management initiatives, which seem further progressed relative to most of its peers, should drive productivity benefits sooner and free up investment spend to be directed more towards customer experience, as opposed to infrastructure (3Q21 update shows NAB is tracking well against this).”

In addition, the broker likes NAB due to its strong position in business banking and its mortgage capability.

Goldman said: “Given NAB’s position as the largest business bank and investment in its mortgage capability, we believe it is strongly positioned to benefit from the current recovery in both housing and commercial volumes (3Q21 update showed continued volume momentum).”

Finally, it also likes NAB due to the way it “continues to effectively manage the balance between volumes and margins as well as any peer.”

Overall, the broker feels this makes the NAB share price good value at the current level.

The post Why Goldman thinks the NAB (ASX:NAB) share price is undervalued appeared first on The Motley Fool Australia.

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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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