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Australia & New Zealand Banking (ANZGY)
OTHER OTC:ANZGY
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Australia & New Zealand Banking
(OTC:ANZGY)
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Rating:72Outperform
Price Target:―
ANZGY scores a 72 due to its solid financial performance and strategic achievements highlighted in the earnings call, such as the successful acquisition of Suncorp Bank. However, technical indicators suggest a bearish trend, and challenges in non-financial risk management and retail banking margins temper the overall outlook.
Positive Factors
Strategic Acquisition
The acquisition of Suncorp Bank has expanded ANZ's customer deposit base, making it the second largest in Australia. This strengthens its market position and enhances its competitive advantage in the banking sector.
Institutional Segment Performance
ANZ's institutional segment achieved record revenues and returns, driven by its industry-leading platform, Transactive. This highlights the bank's strong market position and ability to generate high returns in institutional banking.
Revenue and Lending Growth
ANZ reported an 11% increase in customer deposits and a 15% FX-adjusted growth in lending. This demonstrates robust revenue growth and a strong lending portfolio, supporting long-term financial stability.
Negative Factors
Non-Financial Risk Management
ANZ faces challenges in non-financial risk management, with regulatory concerns from APRA. This could lead to increased oversight and potential regulatory costs, impacting long-term operational efficiency.
Margin Pressure in Retail Banking
Significant margin pressure in the Australian retail banking sector requires ANZ to focus on cost reductions. This could affect profitability and necessitate strategic adjustments to maintain margins.
Increased Costs from Suncorp Integration
The integration of Suncorp Bank has led to higher operational costs. While strategic, these costs may strain short-term profitability and require careful management to realize long-term benefits.
Australia & New Zealand Banking (ANZGY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$70.96B
Dividend Yield4.51%
Average Volume (3M)6.21K
Price to Earnings (P/E)16.2
Beta (1Y)0.60
Revenue Growth2.74%
EPS Growth-11.28%
CountryUS
Employees43,094
SectorFinancial
Sector Strength70
IndustryBanks - Diversified
Share Statistics
EPS (TTM)0.48
Shares Outstanding2,971,365,700
10 Day Avg. Volume4,521
30 Day Avg. Volume6,209
Financial Highlights & Ratios
PEG Ratio-1.74
Price to Book (P/B)1.30
Price to Sales (P/S)4.47
P/FCF Ratio9.15
Enterprise Value/Market Cap1.52
Enterprise Value/Revenue5.11
Enterprise Value/Gross Profit5.11
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Australia & New Zealand Banking Business Overview & Revenue Model
Company DescriptionAustralia & New Zealand Banking Group Limited (ANZGY), commonly referred to as ANZ, is one of the largest banking and financial services groups in Australia, with a significant presence in New Zealand and the Asia-Pacific region. The company offers a wide range of financial products and services, including personal banking, commercial banking, wealth management, and institutional banking services. ANZ serves over 8 million customers and operates across various sectors, including retail, corporate, and investment banking.
How the Company Makes MoneyANZ makes money primarily through interest income generated from its lending activities, which include personal loans, mortgages, and business loans. In addition to interest income, ANZ earns revenue through fees and commissions from its wealth management services, transaction banking, and foreign exchange operations. The bank also benefits from its institutional banking segment, which provides services such as trade finance, cash management, and capital markets solutions. Significant partnerships with financial technology firms and other strategic alliances further enhance its service offerings and revenue potential. Additionally, ANZ's geographic diversification across Australia, New Zealand, and the Asia-Pacific region contributes to its robust earnings profile.
Australia & New Zealand Banking Earnings Call Summary
Earnings Call Date:Nov 07, 2024
(Q4-2024)
| % Change Since: |
Next Earnings Date:May 13, 2026
Earnings Call Sentiment Neutral
ANZ's earnings call reflected a strong strategic progression with the successful acquisition and integration of Suncorp Bank and record performance in the Institutional segment. However, challenges remain in non-financial risk management and margin pressures in retail banking. The strategic focus on technology platforms like ANZ Plus and Transactive aims to address these challenges by reducing costs and improving customer engagement.Q4-2024 Updates
Positive Updates
Completion of Suncorp Bank Acquisition
ANZ completed the purchase of Suncorp Bank, which is performing better than expected. This acquisition has significantly increased ANZ's customer deposit base, making it the second largest among Australian banks.
Institutional Segment Record Performance
ANZ's Institutional segment delivered another record result with industry-leading platform Transactive, achieving record revenues, profit before provisions, and return on equity.
ANZ Plus Growth
ANZ Plus achieved 1% share of all retail deposits in Australia within two years and is already home to nearly one in five of ANZ's active Australian retail customers, showing strong engagement and lower acquisition costs.
Strong Revenue and Lending Growth
Customer deposits increased 11% year-on-year, and lending grew with a step-up of $102 billion in gross lending assets, a 15% FX-adjusted increase.
Improved Capital Efficiency
Capital efficiency programs released around $30 billion of risk-weighted assets, contributing to improved financial metrics and shareholder returns.
Negative Updates
Non-Financial Risk Management Concerns
ANZ faces challenges in non-financial risk management, with APRA placing a capital overlay due to inadequate progress in this area.
Continued Margin Pressure in Retail Banking
The Australian retail banking sector faces significant margin pressure, requiring ANZ to focus on cost reductions and platform efficiencies.
Increased Costs Due to Suncorp Integration
Integration of Suncorp Bank led to higher costs, with the need to transition services and align with ANZ's operations.
Company Guidance
In the call, ANZ provided a comprehensive overview of its financial performance for Fiscal Year 2024, emphasizing several key metrics. The bank noted a strong strategic year, highlighted by the completion of the Suncorp Bank acquisition, contributing to a customer deposit increase of 11% year-on-year and making ANZ the second largest in customer deposits among Australian banks. ANZ's institutional segment delivered record revenues and return on equity, while ANZ Plus now holds a 1% share of all retail deposits in Australia. The bank reported its second highest revenue ever, maintaining stability from 2023 on a constant currency basis, with lending and deposit volumes growing robustly. Cash earnings and earnings per share showed significant growth over two to three years, driving better shareholder dividends. Additionally, substantial investments in technology platforms, amounting to $2.5 billion over five years, facilitated enhancements in efficiency and customer engagement, crucial for sustaining profitability amid challenging market conditions. ANZ also announced a final year dividend of $0.83 per share, franked at 70%, indicating stronger returns for shareholders.Australia & New Zealand Banking Financial Statement Overview
Summary
Australia & New Zealand Banking presents a solid financial profile with consistent revenue growth and strong equity positioning. Despite a slight decline in net income, the company maintains financial stability with low leverage. Strong operating cash flows bolster liquidity, although further improvement in free cash flow relative to net income would enhance overall financial flexibility.Income Statement
The income statement shows steady revenue growth with a revenue increase from 18,342 million in 2021 to 20,355 million in 2024. However, net income has decreased from 7,098 million in 2023 to 6,535 million in 2024, indicating some pressure on profitability. The gross profit margin remains strong, reflecting efficient cost management.75
Positive
Balance Sheet
The balance sheet is robust with a high equity ratio as stockholders' equity stands at 69,857 million against total assets of 1,229,115 million, showing strong capital reserves. The debt-to-equity ratio is favorable with zero total debt in 2024, indicating low leverage and high financial stability.80
Positive
Cash Flow
Operating cash flow has improved to 9,952 million in 2024 from 6,488 million in 2023, a positive sign for liquidity. However, free cash flow growth is constrained, and the free cash flow to net income ratio indicates room for improvement in cash generation relative to profitability.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 21.10B | 20.36B | 20.28B | 19.66B | 17.99B | 18.30B |
| Gross Profit | 21.10B | 20.36B | 20.28B | 18.94B | 17.83B | 18.30B |
| EBITDA | 0.00 | 0.00 | 0.00 | 11.09B | 10.02B | 0.00 |
| Net Income | 6.73B | 6.54B | 7.10B | 7.12B | 6.16B | 3.58B |
Balance Sheet | ||||||
| Total Assets | 1.30T | 1.23T | 1.11T | 1.09T | 978.86B | 1.04T |
| Cash, Cash Equivalents and Short-Term Investments | 202.66B | 112.99B | 146.44B | 157.53B | 141.89B | 116.27B |
| Total Debt | 231.51B | 121.28B | 150.08B | 134.00B | 78.43B | 130.51B |
| Total Liabilities | 1.23T | 1.16T | 1.04T | 1.02T | 915.18B | 980.99B |
| Stockholders Equity | 71.57B | 69.86B | 69.52B | 65.91B | 63.66B | 61.29B |
Cash Flow | ||||||
| Free Cash Flow | -25.21B | 9.95B | 5.88B | 19.52B | 43.26B | 53.08B |
| Operating Cash Flow | -25.21B | 9.95B | 6.49B | 20.18B | 43.82B | 52.28B |
| Investing Cash Flow | -31.70B | -42.12B | -10.69B | -1.82B | 10.26B | -11.46B |
| Financing Cash Flow | 112.22B | 17.91B | 4.38B | -2.35B | -9.67B | -12.43B |
Australia & New Zealand Banking Technical Analysis
Positive
23.46
Price Trends
22.92
Positive
21.73
Positive
19.80
Positive
Market Momentum
-0.02
Negative
56.22
Neutral
96.99
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ANZGY, the sentiment is Positive. The current price of 23.46 is above the 20-day moving average (MA) of 23.09, above the 50-day MA of 22.92, and above the 200-day MA of 19.80, indicating a bullish trend. The MACD of -0.02 indicates Negative momentum. The RSI at 56.22 is Neutral, neither overbought nor oversold. The STOCH value of 96.99 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ANZGY.
Australia & New Zealand Banking Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $65.90B | 9.57 | 14.58% | 3.90% | 7.43% | 30.31% | |
77 Outperform | $80.46B | 10.64 | 9.44% | 1.88% | 17.50% | 49.25% | |
73 Outperform | $126.37B | 10.99 | 18.00% | 3.48% | 7.52% | 10.40% | |
72 Outperform | $70.96B | 16.20 | 9.75% | 4.51% | 2.74% | -11.28% | |
72 Outperform | $77.41B | 11.80 | 11.71% | 4.44% | 2.20% | -0.17% | |
72 Outperform | $163.81B | 10.93 | 12.54% | 1.99% | -15.34% | 16.71% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
ANZGY
Australia & New Zealand Banking
23.46
5.04
27.36%
BBVA
Banco Bilbao
21.80
12.23
127.80%
BCS
Barclays
23.22
10.03
76.04%
ING
ING Groep
26.28
11.30
75.43%
NWG
NatWest Group
16.51
6.45
64.12%
SAN
Banco Santander SA
10.97
6.21
130.46%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.