Westpac Banking Corporation

ASX:WBC Stock Report

Market Cap: AU$113.4b

Westpac Banking Valuation

Is WBC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of WBC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: WBC (A$33.54) is trading below our estimate of fair value (A$34.38)

Significantly Below Fair Value: WBC is trading below fair value, but not by a significant amount.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for WBC?

Key metric: As WBC is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for WBC. This is calculated by dividing WBC's market cap by their current earnings.
What is WBC's PE Ratio?
PE Ratio16.5x
EarningsAU$6.99b
Market CapAU$113.44b

Price to Earnings Ratio vs Peers

How does WBC's PE Ratio compare to its peers?

The above table shows the PE ratio for WBC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average16.8x
NAB National Australia Bank
17.1x2.3%AU$120.5b
ANZ ANZ Group Holdings
14.7x3.3%AU$95.7b
CBA Commonwealth Bank of Australia
27.6x4.5%AU$261.5b
BFL BSP Financial Group
7.9xn/aAU$2.9b
WBC Westpac Banking
16.5x0.1%AU$113.4b

Price-To-Earnings vs Peers: WBC is good value based on its Price-To-Earnings Ratio (16.5x) compared to the peer average (16.8x).

Price to Earnings Ratio vs Industry

How does WBC's PE Ratio compare vs other companies in the Global Banks Industry?

18 CompaniesPrice / EarningsEstimated GrowthMarket Cap
WBC 16.5xIndustry Avg. 10.1xNo. of Companies166PE0612182430+
18 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: WBC is expensive based on its Price-To-Earnings Ratio (16.5x) compared to the Global Banks industry average (10.1x).

Price to Earnings Ratio vs Fair Ratio

What is WBC's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

WBC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio16.5x
Fair PE Ratio16.1x

Price-To-Earnings vs Fair Ratio: WBC is expensive based on its Price-To-Earnings Ratio (16.5x) compared to the estimated Fair Price-To-Earnings Ratio (16.1x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst WBC forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentAU$33.54
AU$27.80
-17.1%
11.0%AU$33.00AU$20.00n/a14
Nov ’25AU$32.10
AU$27.04
-15.8%
11.1%AU$33.00AU$20.00n/a14
Oct ’25AU$31.19
AU$26.89
-13.8%
10.8%AU$33.00AU$20.00n/a15
Sep ’25AU$31.24
AU$26.44
-15.4%
9.0%AU$30.40AU$20.00n/a15
Aug ’25AU$29.71
AU$25.05
-15.7%
8.3%AU$28.40AU$20.00n/a15
Jul ’25AU$27.21
AU$24.98
-8.2%
8.3%AU$28.40AU$20.00n/a15
Jun ’25AU$25.98
AU$24.90
-4.2%
8.4%AU$28.25AU$20.00n/a15
May ’25AU$25.79
AU$23.86
-7.5%
10.5%AU$28.00AU$18.50n/a14
Apr ’25AU$26.10
AU$23.74
-9.1%
10.8%AU$28.00AU$18.50n/a14
Mar ’25AU$26.41
AU$23.22
-12.1%
11.4%AU$28.00AU$17.50n/a14
Feb ’25AU$23.77
AU$22.07
-7.2%
10.9%AU$28.00AU$17.50n/a14
Jan ’25AU$22.90
AU$21.53
-6.0%
10.5%AU$28.00AU$17.50n/a14
Dec ’24AU$21.27
AU$21.79
+2.4%
11.0%AU$28.00AU$17.50n/a15
Nov ’24AU$20.74
AU$21.52
+3.8%
11.4%AU$28.00AU$17.50AU$32.1015
Oct ’24AU$21.15
AU$21.52
+1.7%
11.9%AU$28.00AU$17.50AU$31.1915
Sep ’24AU$21.79
AU$21.92
+0.6%
11.0%AU$28.00AU$17.50AU$31.2416
Aug ’24AU$22.43
AU$22.30
-0.6%
10.1%AU$28.00AU$19.00AU$29.7116
Jul ’24AU$21.34
AU$22.32
+4.6%
10.1%AU$28.00AU$19.00AU$27.2116
Jun ’24AU$20.60
AU$22.50
+9.2%
10.2%AU$28.00AU$19.00AU$25.9816
May ’24AU$22.56
AU$23.63
+4.8%
10.8%AU$29.00AU$19.00AU$25.7916
Apr ’24AU$21.66
AU$24.08
+11.2%
12.5%AU$30.00AU$19.00AU$26.1016
Mar ’24AU$22.07
AU$24.59
+11.4%
12.5%AU$30.00AU$19.00AU$26.4116
Feb ’24AU$23.60
AU$24.72
+4.7%
12.7%AU$30.00AU$19.00AU$23.7716
Jan ’24AU$23.35
AU$24.95
+6.9%
13.6%AU$30.00AU$19.00AU$22.9016
Dec ’23AU$23.92
AU$24.98
+4.4%
14.0%AU$30.00AU$19.00AU$21.2715
Nov ’23AU$24.32
AU$25.05
+3.0%
13.8%AU$30.00AU$17.95AU$20.7416

Analyst Forecast: Target price is lower than the current share price.

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