Increases to National Australia Bank Limited's (ASX:NAB) CEO Compensation Might Cool off for now
Dec 08
Australian (ASX) Financials Sector Analysis
UpdatedDec 08, 2023
DataAggregated Company Financials
Companies155
- 7D1.2%
- 3M1.5%
- 1Y0.05%
- YTD2.5%
The Financials industry is up 1.2% in the last week, with Commonwealth Bank of Australia up 2.2%. During this same period, the QBE Insurance Group underperformed, falling 5.3%. Despite this gain, the industry's performance has been flat over the past year. Looking forward, earnings are forecast to grow by 3.6% annually.
Sector Valuation and Performance
Has the Australian Financials Sector valuation changed over the past few years?
| Date | Market Cap | Revenue | Earnings | PE | Absolute PE | PS |
|---|---|---|---|---|---|---|
| Fri, 08 Dec 2023 | AU$662.4b | AU$198.8b | AU$45.6b | 16.8x | 14.5x | 3.3x |
| Sun, 05 Nov 2023 | AU$646.9b | AU$196.5b | AU$44.5b | 16.3x | 14.5x | 3.3x |
| Tue, 03 Oct 2023 | AU$649.8b | AU$197.7b | AU$45.5b | 16.2x | 14.3x | 3.3x |
| Thu, 31 Aug 2023 | AU$658.7b | AU$197.9b | AU$45.8b | 16.5x | 14.4x | 3.3x |
| Sat, 29 Jul 2023 | AU$672.4b | AU$186.9b | AU$44.4b | 19.9x | 15.1x | 3.6x |
| Mon, 26 Jun 2023 | AU$629.3b | AU$187.0b | AU$44.6b | 17x | 14.1x | 3.4x |
| Wed, 24 May 2023 | AU$629.6b | AU$185.2b | AU$43.5b | 17.8x | 14.5x | 3.4x |
| Fri, 21 Apr 2023 | AU$647.1b | AU$182.0b | AU$42.3b | 17.8x | 15.3x | 3.6x |
| Sun, 19 Mar 2023 | AU$618.8b | AU$181.4b | AU$42.6b | 16.7x | 14.5x | 3.4x |
| Tue, 14 Feb 2023 | AU$679.8b | AU$179.0b | AU$40.6b | 16.5x | 16.8x | 3.8x |
| Thu, 12 Jan 2023 | AU$648.2b | AU$177.8b | AU$40.2b | 14.7x | 16.1x | 3.6x |
| Sat, 10 Dec 2022 | AU$646.9b | AU$178.2b | AU$40.2b | 14.1x | 16.1x | 3.6x |
| Mon, 07 Nov 2022 | AU$656.2b | AU$179.9b | AU$39.7b | 15.9x | 16.5x | 3.6x |
| Wed, 05 Oct 2022 | AU$614.3b | AU$178.2b | AU$39.0b | 15.1x | 15.8x | 3.4x |
| Fri, 02 Sep 2022 | AU$626.8b | AU$177.0b | AU$39.0b | 15.6x | 16.1x | 3.5x |
| Sun, 31 Jul 2022 | AU$645.0b | AU$179.9b | AU$40.9b | 14.2x | 15.8x | 3.6x |
| Tue, 28 Jun 2022 | AU$601.0b | AU$179.9b | AU$40.8b | 13.3x | 14.7x | 3.3x |
| Thu, 26 May 2022 | AU$666.7b | AU$179.7b | AU$40.8b | 14.9x | 16.3x | 3.7x |
| Sat, 23 Apr 2022 | AU$694.0b | AU$175.8b | AU$39.3b | 15.6x | 17.6x | 3.9x |
| Mon, 21 Mar 2022 | AU$681.3b | AU$175.4b | AU$39.3b | 15.5x | 17.4x | 3.9x |
| Wed, 16 Feb 2022 | AU$671.2b | AU$173.7b | AU$37.6b | 15.2x | 17.9x | 3.9x |
| Fri, 14 Jan 2022 | AU$688.2b | AU$172.2b | AU$36.2b | 15.5x | 19x | 4x |
| Sun, 12 Dec 2021 | AU$667.6b | AU$171.9b | AU$36.2b | 16.2x | 18.4x | 3.9x |
| Tue, 09 Nov 2021 | AU$706.0b | AU$169.3b | AU$34.5b | 16.1x | 20.5x | 4.2x |
| Thu, 07 Oct 2021 | AU$680.0b | AU$163.9b | AU$31.2b | 16.5x | 21.8x | 4.1x |
| Sat, 04 Sep 2021 | AU$699.8b | AU$163.8b | AU$31.5b | 16.8x | 22.2x | 4.3x |
| Mon, 02 Aug 2021 | AU$676.9b | AU$163.8b | AU$31.5b | 16.1x | 21.5x | 4.1x |
| Thu, 06 May 2021 | AU$641.4b | AU$158.6b | AU$28.2b | 16.5x | 22.7x | 4x |
| Sun, 07 Feb 2021 | AU$570.6b | AU$150.4b | AU$22.3b | 17.9x | 25.6x | 3.8x |
Price to Earnings Ratio
25.1x
Current Industry PE
- Investors are pessimistic on the Australian Financials industry, indicating that they anticipate long term growth rates will be lower than they have historically.
- The industry is trading at a PE ratio of 14.5x which is lower than its 3-year average PE of 18.0x.
- The 3-year average PS ratio of 3.7x is higher than the industry's current PS ratio of 3.3x.
Past Earnings Growth
- The earnings for companies in the Financials industry have grown 27% per year over the last three years.
- Revenues for these companies have grown 9.7% per year.
- This means that more sales are being generated by these companies overall, and subsequently their profits are increasing too.
Industry Trends
Which industries have driven the changes within the Australian Financials sector?
| AU Market | 1.05% | |
| Financials | 1.17% | |
| Consumer Finance | 1.94% | |
| Banks | 1.85% | |
| Capital Markets | 0.82% | |
| Mortgage Finance | 0% | |
| Mortgage REITs | 0% | |
| Diversified Financial | -0.51% | |
| Insurance | -1.51% | |
Industry PE
- Investors are most optimistic about the Diversified Financial industry which is trading above its 3-year average PE ratio.
- Analysts expect its future annual earnings growth (11.5%) to be largely in line with prior year's earnings growth.
Forecasted Growth
- Analysts are most optimistic on the Consumer Finance industry, expecting annual earnings growth of 38% over the next 5 years.
- This is better than its past earnings decline of 15% per year.
- In contrast, the Banks industry is expected to see its earnings growth to stay flat over the next few years.
Top Stock Gainers and Losers
Which companies have driven the market over the last 7 days?
| Company | Last Price | 7D | 1Y | Valuation | |
|---|---|---|---|---|---|
| CBA Commonwealth Bank of Australia | AU$106.44 | 2.2% +AU$3.8b | 1.4% | PB2.5x | |
| NAB National Australia Bank | AU$29.20 | 2.7% +AU$2.4b | -3.3% | PB1.5x | |
| WBC Westpac Banking | AU$21.92 | 3.1% +AU$2.3b | -6.5% | PB1.1x | |
| ANZ ANZ Group Holdings | AU$24.61 | 0.7% +AU$540.2m | 4.1% | PB1.1x | |
| MQG Macquarie Group | AU$169.35 | 0.9% +AU$496.6m | 0.8% | PE15x |
