Judo Bank leads banking rally as Citi analysts boost target price
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The news: Shares in Judo Bank were among the biggest winners in afternoon trade after Citi analysts upgraded their rating on the stock to ‘buy’ and lifted their target price on a slew of banking sector stocks amid favourable macro conditions.
The numbers: At 1:54pm AEST, shares in Judo Bank had lifted 3.5% to $1.71 as the broader finance sector lifted about 1.2%.
Citi lifted its target price on Judo Bank from $1.85 to $2 and lifted its rating on the stock from ‘neutral’ to ‘buy’.
Meanwhile, Citi lifted its position on Westpac (+1.5%) and Bank of Queensland (+2%) stocks from ‘sell’ to ‘neutral’. The analysts also lifted their respective price targets from $29.75 to $36.50 and from $6 to $6.60.
Citi also lifted price targets for:
- ANZ – From $29.50 to $32.50. Shares gained 1.8%;
- Commonwealth Bank – From $110 to $130. Shares lifted 1.7%;
- NAB – From $31.50 to $36. Shares were up 1.7%;
- Bendigo & Adelaide Bank – From $10.50 and $11. Shares slipped 0.3%.
The context: In a research note, the Citi analysts said the shifting macro environment “continues to favour banks” as credit growth remains resilient, net interest margins are well-managed “as risk skews to less rate cuts”, and asset quality “remains benign”.
However, the analysts acknowledged that the banks are “not exactly cheap” and are showing “minimal growth”.
The source: Citi research
