Westpac Banking (WEBNF) AI Stock Analysis

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Westpac Banking (WEBNF) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$73.85B

Dividend Yield4.75%

Average Volume (3M)1.86K

Price to Earnings (P/E)15.8

Beta (1Y)0.72

Revenue GrowthN/A

EPS GrowthN/A

CountryUS

Employees34,168

SectorFinancial

Sector Strength82

IndustryBanks - Diversified

Share Statistics

EPS (TTM)0.64

Shares Outstanding3,422,043,200

10 Day Avg. Volume2,042

30 Day Avg. Volume1,856

Financial Highlights & Ratios

PEG Ratio1.11

Price to Book (P/B)1.50

Price to Sales (P/S)0.00

P/FCF Ratio-7.84

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$18.90

Price Target Upside-9.48% Downside

Rating ConsensusModerate Sell

Number of Analyst Covering10

Westpac Banking Business Overview & Revenue Model

Company DescriptionWestpac Banking Corporation provides various banking and financial services in Australia, New Zealand, and internationally. It offers savings, term deposit, business transaction, not-for-profit transaction, foreign currency, farm management deposit, project and retention trust, and statutory trust accounts; home, personal, business, and commercial loans; car and equipment finance; business overdrafts and bank guarantees; debit and credit cards; international and travel services; share trading services; investment products; and home, car, travel, life, caravan and trailer, credit card and loan repayment, boat, and business insurance products. The company also provides corporate and institutional, transaction banking, financial market, corporate and structured finance, trade and supply chain financing, and industry specific banking and treasury services, as well as online banking services. It serves individuals; micro, small, and medium enterprises; commercial business and private wealth clients; and commercial, corporate, institutional, and government customers. The company was formerly known as Bank of New South Wales and changed its name to Westpac Banking Corporation in October 1982. The company was founded in 1817 and is based in Sydney, Australia.

How the Company Makes Money

Westpac Banking Earnings Call Summary

Earnings Call Date:May 04, 2025

(Q4-2024)

% Change Since: 62.87%|

Next Earnings Date:Nov 03, 2025

Earnings Call Sentiment Neutral

The earnings call presents a mixed picture with strong growth in business loans and deposits, ongoing digital innovation, and a robust capital position. However, these positives are tempered by a decline in statutory net profit, increased expenses, and margin pressures in the consumer segment. The competitive landscape remains challenging, particularly in the mortgage market.

Q4-2024 Updates

Positive Updates

Loan and Deposit Growth

Business loans and consumer deposits grew 8%, while mortgages were up 5%.

Share Buyback Program Expansion

The strength of the group's balance sheet supported a further $1 billion increase in the share buyback program.

Improved Operational Efficiency

Mortgage approval times were cut to less than 5 days, and service levels were more consistent throughout the year.

Digital Innovation and Customer Engagement

The Westpac app was rated the #1 mobile banking app by Forrester, and new app prompts helped 190,000 customers earn an average extra $324 in annual interest.

Institutional Segment Growth

Institutional lending grew by 9% with strong returns, and customer advocacy increased by 5 points to 64.

Capital Position

CET1 ratio at 12.5%, placing Westpac in the top quartile of banks globally.

Negative Updates

Statutory Net Profit Decline

Statutory net profit was $7 billion, down 3% from the previous year.

Increased Expenses

Expenses rose by 7% due to higher technology costs and the cost to wind down RAMS.

Noninterest Income Decrease

Noninterest income was lower due to the impact of businesses sold last year and softer performance in markets.

Consumer Margin Pressure

Net interest margin (NIM) in the consumer segment was down 18 basis points over the year.

Higher Banking Sector Competition

Challenging competition in the mortgage market led to pricing adjustments and volume fluctuations.

Company Guidance

During the 2024 results call, Westpac provided detailed guidance on several financial metrics. The bank's statutory net profit was reported at $7 billion, marking a 3% decline, while its return on tangible equity stood at 11%. Excluding notable items, the net profit was marginally higher at $7.1 billion, with revenue increasing by 1% due to robust loan growth across key segments. The bank's net interest margin, excluding notable items, saw a slight decline of just 1 basis point. Business loans and consumer deposits experienced an 8% growth, and mortgages rose by 5%, highlighting strong performance in these areas. In terms of cost management, expenses were up by 7%, influenced by rising technology expenses and software amortization. Impairment charges were notably low at 7 basis points of loans, thanks to prudent lending practices. The bank's capital position was reinforced with a CET1 ratio of 12.5%, and a further $1 billion was allocated to the share buyback program, reflecting a strong balance sheet and a focus on returning capital to shareholders.

Westpac Banking Financial Statement Overview

Summary

Westpac Banking demonstrates stable revenue growth and operational efficiency, supporting a robust income statement profile. The balance sheet reflects a well-capitalized institution with controlled leverage, though high debt levels warrant monitoring. Cash flow difficulties highlight potential liquidity issues, necessitating improved cash generation from operations to sustain future growth without over-reliance on external funding.

Income Statement

Positive

Westpac Banking shows a stable gross profit margin with a slight increase in total revenue over the past year. The net profit margin improved compared to the previous period, although it remains moderate due to fluctuations in net income. Revenue growth rate is positive, indicating a recovery trend, while EBIT margin shows strength in operational efficiency. However, the absence of EBITDA data limits the analysis.

Balance Sheet

Positive

Westpac presents a solid equity base with a satisfactory debt-to-equity ratio, suggesting manageable leverage levels. The return on equity is healthy, reflecting efficient utilization of shareholders' funds. The equity ratio remains stable, signifying a balanced capital structure. However, the high total debt level poses a potential risk if interest rates rise.

Cash Flow

Positive

The cash flow analysis reveals challenges in generating positive free cash flow, with a significant negative free cash flow growth rate year-over-year. The operating cash flow to net income ratio is negative, indicating operational cash flow challenges. While financing activities provide liquidity, the reliance on external funding could be a concern if cash flows do not improve.

Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Breakdown
Income Statement		Total Revenue
21.05B	21.00B	19.27B	21.81B	17.00B
	Gross Profit
21.05B	21.00B	19.27B	21.81B	17.00B
	EBIT
10.19B	11.20B	9.50B	10.75B	5.88B
	EBITDA
0.00	11.55B	10.06B	-1.06B	-689.00M
	Net Income Common Stockholders
6.98B	7.20B	5.69B	5.46B	2.29B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
168.07B	102.22B	104.95B	70.91B	29.67B
	Total Assets
1.08T	1.03T	1.01T	935.88B	911.95B
	Total Debt
207.17B	138.20B	126.71B	113.17B	125.84B
	Net Debt
140.90B	35.97B	21.76B	42.26B	96.17B
	Total Liabilities
1.01T	957.24B	943.69B	863.78B	843.87B
	Stockholders Equity
71.70B	72.50B	70.45B	72.03B	68.02B
Cash Flow		Free Cash Flow
-20.78B	-35.73B	-18.27B	16.44B	29.50B
	Operating Cash Flow
-19.77B	-35.49B	-18.10B	16.67B	29.74B
	Investing Cash Flow
-80.24B	1.71B	2.81B	5.62B	-19.48B
	Financing Cash Flow
45.08B	30.35B	48.29B	18.64B	107.00M

Westpac Banking Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WEBNF		$73.85B	15.78	9.85%	4.75%	―	―
Sector *	64 Neutral	$12.87B	9.81	7.76%	16985.65%	12.28%	-7.83%
ANZGF		$57.00B	12.93	9.75%	5.66%	―	―
CMSQF		$15.54B	22.64	27.30%	2.15%	―	―
MCQEF		$51.28B	22.08	10.63%	2.99%	―	―
NAUBF		$76.73B	17.42	11.51%	4.36%	―	―
CBA	54 Neutral	AU$300.76B	30.80	13.22%	2.64%	17.35%	0.73%

* Financial Sector Average

Performance Comparison

WEBNF

Westpac Banking

20.88

4.27

25.71%

ANZGF

ANZ Group Holdings

19.12

0.86

4.71%

CMSQF

Computershare Limited

26.70

9.25

53.01%

MCQEF

Macquarie Group Limited

141.02

14.74

11.67%

NAUBF

National Australia Bank Limited

25.40

3.23

14.57%

AU:CBA

Commonwealth Bank of Australia

179.90

58.91

48.69%

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.