National Australia Bank (NABZY) AI Stock Analysis

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National Australia Bank

(OTC:NABZY)

Rating:66Neutral

Price Target:―

National Australia Bank's overall score reflects a balance of strong revenue generation and profitability with challenges in cash flow and leverage. The earnings call highlights mixed performance, with positive developments in business banking but ongoing challenges. Technical indicators suggest short-term momentum, but valuation risks need consideration.

National Australia Bank (NABZY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$77.67B

Dividend Yield4.3%

Average Volume (3M)86.91K

Price to Earnings (P/E)17.5

Beta (1Y)0.72

Revenue Growth21.13%

EPS Growth-5.96%

CountryUS

Employees39,976

SectorFinancial

Sector Strength79

IndustryBanks - Diversified

Share Statistics

EPS (TTM)0.35

Shares Outstanding6,125,034,700

10 Day Avg. Volume0

30 Day Avg. Volume86,913

Financial Highlights & Ratios

PEG Ratio0.63

Price to Book (P/B)0.80

Price to Sales (P/S)0.00

P/FCF Ratio1.75

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

National Australia Bank Business Overview & Revenue Model

Company DescriptionNational Australia Bank Limited provides financial services to individuals and businesses in Australia, New Zealand, and internationally. It operates through Business and Private Banking, Personal Banking, Corporate and Institutional Banking, and New Zealand Banking segments. It operates through Business and Private Banking; Personal Banking; Corporate and Institutional Banking; New Zealand Banking; and Corporate Functions and Other segments. The company accepts transaction accounts, savings accounts, deposit accounts, and term deposits; and specialized accounts, such as foreign currency, business interest, statutory trust, community free saver, farm management, and project bank accounts, as well as farm management deposits. National Australia Bank Limited also provides home loans; personal loans; business loans; vehicle and equipment finance; and trade and invoice finance, as well as business overdrafts and bank guarantees. In addition, the company offers insurance products consisting of car, home and content, landlord, travel, caravan and trailer, life, and business insurance products; and pension, superannuation, self-managed super funds, cash management, and financial planning and advisory services. Further, it provides investment products; credit, debit, and business cards; payments and merchant services; travel services; online and internet banking services; small business services; international and foreign exchange solutions; and industry specific banking services. National Australia Bank Limited was founded in 1834 and is based in Melbourne, Australia.

How the Company Makes MoneyNational Australia Bank generates revenue primarily through interest income from loans and advances issued to personal, business, and institutional clients. The bank also earns income from fees and commissions related to its various banking services such as transaction accounts, credit cards, and wealth management advisory. Additionally, NAB benefits from trading and investment activities, including foreign exchange and securities trading. The bank has strategic partnerships and collaborations with fintech companies to enhance its digital services and expand its customer base, contributing to its overall earnings.

National Australia Bank Earnings Call Summary

Earnings Call Date:May 06, 2025

(Q4-2024)

% Change Since: 13.85%|

Next Earnings Date:Nov 06, 2025

Earnings Call Sentiment Neutral

The earnings call reflects a mixed performance with solid achievements in business banking and customer deposit growth, while facing challenges like decreased cash earnings and asset quality deterioration. Despite some positive strategic developments, competitive pressures and reduced ROE highlight ongoing challenges.

Q4-2024 Updates

Positive Updates

Resilient Australian Economy

The Australian economy has shown resilience with easing inflationary pressures and a potential soft landing anticipated. Business conditions have remained sound, supported by consumer demand and robust levels of business activity.

Strong Business Banking Performance

Business Lending in Business and Private Banking grew by 8% year-on-year, outperforming the system, indicating strong balance sheet outcomes with 35% growth in total lending and 46% growth in deposits over the last four years.

Increase in Customer Deposits

Customer deposits funded 83% of lending, up from 70% in 2019, reflecting a consistent focus on growing customer deposits.

Launch of NAB Goodies Loyalty Program

The NAB Goodies program successfully launched with 2.8 million visits and over $3 million paid in cashbacks since June, enhancing customer engagement.

Improvement in Net Promoter Scores

Business Net Promoter Scores improved in the second half, suggesting better customer experience management compared to the first half.

Negative Updates

Decrease in Cash Earnings

Cash earnings decreased by 8.1% year-on-year, primarily due to a 6.9% decrease in underlying earnings, impacted by lower revenue and higher costs.

Asset Quality Deterioration

Challenging economic conditions led to asset quality deterioration, with non-performing loans increasing by 19 basis points in the second half, impacting both business and consumer portfolios.

Competitive Pressures in Home Lending

Revenue was impacted by competitive pressures in home lending, with margin pressures moderating only in the second half.

Decrease in Return on Equity

Cash return on equity declined to 11.6% from peak levels in FY '23, although remaining in line with returns achieved in 2022.

Company Guidance

During the call, NAB provided guidance on several key metrics for the fiscal year 2024. The bank reported an 8.1% decline in cash earnings, primarily due to a 6.9% decrease in underlying earnings driven by lower revenue and higher costs. The cash return on equity decreased to 11.6%, with a final dividend of $0.85 per share bringing the total dividend to $1.69, representing 73.7% of cash earnings. NAB maintained a strong common equity Tier 1 ratio of 12.35%, comfortably above the target range of 11% to 11.5%. The liquidity coverage ratio and net stable funding ratio remained well above the minimum requirements. Investment spend is set to increase to approximately $1.8 billion in FY '25, up from $1.64 billion in FY '24, with a focus on customer advocacy and technology modernization. Additionally, the bank completed $7.4 billion in buybacks over the last three years, enhancing fiscal 2024 return on equity by around 85 basis points. Despite challenging economic conditions, NAB's collective provisioning coverage stayed robust at 1.47%, with a total collective provision balance of $5.2 billion.

National Australia Bank Financial Statement Overview

Summary

National Australia Bank exhibits strong revenue generation and a stable equity position, but faces challenges with cash flow management and high leverage. The profitability metrics are solid, but significant debt levels and negative free cash flow require strategic improvement.

Income Statement

Positive

The income statement shows moderate growth and profitability. The gross profit margin remains strong, and the net profit margin is healthy despite a decline in net income from the previous year. Revenue growth has been steady over the years, although EBIT has fluctuated, particularly with a notable decline in the most recent year. The absence of EBITDA data limits a thorough evaluation of operational efficiency.

Balance Sheet

Positive

The balance sheet reflects a solid equity position with a stable equity ratio. However, the debt-to-equity ratio indicates a significant level of leverage, which could pose risks in fluctuating market conditions. The return on equity has been consistent, underscoring efficient use of equity capital, yet the substantial liabilities warrant cautious monitoring.

Cash Flow

Neutral

The cash flow statement reveals challenges in cash generation, with negative operating cash flows in recent periods. This is concerning for liquidity, albeit the substantial cash reserves provide some buffer. The free cash flow has been negative, reflecting high capital expenditures and operational challenges. The free cash flow to net income ratio is also unfavorable, necessitating improvements in cash management.

Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Breakdown
Income Statement		Total Revenue
20.62B	19.83B	18.33B	16.68B	17.21B
	Gross Profit
20.62B	20.63B	18.33B	16.68B	17.21B
	EBIT
10.63B	11.20B	17.11B	8.96B	4.22B
	EBITDA
0.00	0.00	0.00	0.00	0.00
	Net Income Common Stockholders
6.96B	7.41B	6.89B	6.36B	3.50B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
112.94B	120.20B	144.53B	109.21B	160.95B
	Total Assets
1.08T	1.06T	1.06T	925.97B	866.57B
	Total Debt
296.68B	196.31B	190.26B	169.84B	132.57B
	Net Debt
183.75B	-120.20B	45.73B	60.63B	15.84B
	Total Liabilities
1.02T	997.58B	996.09B	863.19B	805.27B
	Stockholders Equity
61.45B	61.15B	59.03B	62.78B	61.29B
Cash Flow		Free Cash Flow
-37.22B	-27.89B	27.14B	-99.00M	32.92B
	Operating Cash Flow
-35.78B	-26.70B	28.22B	759.00M	33.89B
	Investing Cash Flow
4.69B	-4.21B	-8.70B	-3.69B	-702.00M
	Financing Cash Flow
9.92B	6.98B	6.01B	-22.05B	-16.82B

National Australia Bank Technical Analysis

Technical Analysis Sentiment

Positive

Last Price12.74

Price Trends

50DMA

11.33

Positive

100DMA

11.30

Positive

200DMA

11.72

Positive

Market Momentum

MACD

0.38

Negative

RSI

72.68

Negative

STOCH

97.76

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NABZY, the sentiment is Positive. The current price of 12.74 is above the 20-day moving average (MA) of 12.17, above the 50-day MA of 11.33, and above the 200-day MA of 11.72, indicating a bullish trend. The MACD of 0.38 indicates Negative momentum. The RSI at 72.68 is Negative, neither overbought nor oversold. The STOCH value of 97.76 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NABZY.

National Australia Bank Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SAN	82 Outperform	$120.90B	8.53	13.25%	3.13%	0.27%	19.44%
NWG	77 Outperform	$56.39B	9.34	13.70%	3.83%	18.85%	14.85%
BBVA	77 Outperform	$87.31B	7.80	19.22%	6.08%	19.48%	26.26%
ING	76 Outperform	$66.11B	9.94	11.92%	12.93%	-0.63%	-6.01%
BCS	74 Outperform	$62.34B	8.91	9.36%	3.11%	11.33%	47.74%
NABZY	66 Neutral	$77.67B	17.53	11.51%	4.30%	21.13%	-5.96%
Sector *	64 Neutral	$12.85B	9.81	7.79%	78.20%	12.23%	-7.93%

* Financial Sector Average

Performance Comparison

NABZY

National Australia Bank

12.74

1.59

14.26%

BBVA

Banco Bilbao

15.20

5.91

63.62%

BCS

Barclays

17.76

7.47

72.59%

ING

ING Groep

21.17

5.47

34.84%

NWG

NatWest Group

14.18

6.58

86.58%

SAN

Banco Santander SA

7.96

3.36

73.04%

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.