Following 1H results for National Australia Bank, UBS slightly upgrades cash EPS forecasts due to stronger forecast revenue growth and lower credit impairment charges. Despite this, the broker’s rating falls to Neutral from Buy, after a strong recent share price rally.
The analyst sees strong operational and financial momentum in the business. This momentum is supported by above-system business lending growth and inorganic opportunities for retail banking. The target price rises to $35 from $33.
Sector: Banks.
Target price is $35.00.Current Price is $31.62. Difference: $3.38 – (brackets indicate current price is over target). If NAB meets the UBS target it will return approximately 10% (excluding dividends, fees and charges – negative figures indicate an expected loss).
