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WBK

Westpac BankingNYSE:WBK Stock Report

Last Price

AU$15.54

Market Cap

AU$56.8b

7D

-0.1%

1Y

-5.0%

Updated

16 Jan, 2022

Data

Company Financials +
WBK fundamental analysis
Snowflake Score
Valuation2/6
Future Growth1/6
Past Performance4/6
Financial Health5/6
Dividends4/6

WBK Stock Overview

Westpac Banking Corporation provides various banking and financial services in Australia, New Zealand, the Americas, Asia, Europe, and internationally.

Westpac Banking Competitors

JPMorgan Chase

NYSE:JPM

US$464.8b

Bank of America

NYSE:BAC

US$392.1b

Wells Fargo

NYSE:WFC

US$225.6b

Industrial and Commercial Bank of China

SEHK:1398

HK$2.0t

Price History & Performance

Summary of all time highs, changes and price drops for Westpac Banking
Historical stock prices
Current Share PriceAU$15.54
52 Week HighAU$20.82
52 Week LowAU$14.09
Beta0.85
1 Month Change4.44%
3 Month Change-17.87%
1 Year Change-4.95%
3 Year Change-17.95%
5 Year Change-35.84%
Change since IPO265.65%

Recent News & Updates

Nov 26

Westpac Banking Corp: Opportunity In Rebuilding A Bank

CEO Peter King has led Westpac with excellent progress across its 3 key strategies of Fix, Simplify and Perform. A 17% price rout since the annual report was an over-reaction to slightly softer than expected results, despite an underlying growing business amidst regulatory action. A mispricing of the firm has occurred thanks to an overreaction to the annual report. Westpac's current price significantly undervalues the residential mortgage business, offering access to the Australian property market at a fraction of the cost compared to other lenders. Westpac's forecast revenues may be lower next year; however, EPS has excellent forecast growth of 12% CAGR thanks to increased profitability.

Aug 26

Westpac Banking: Capital Return And Divestments Draw Attention

I have a mixed view of Westpac Banking's recent quarterly update; the bank's Australian mortgages business maintained similar growth as the market, but it also took a A$300 million provision. Westpac Banking might announce significant share buyback plans in November 2021, which is supported by its healthy CET-1 ratio that could be further increased by potential divestments. The market currently values Westpac Banking at 1.33 times trailing P/B and 14.4 times FY 2022 P/E, and the stock also offers a forward FY 2022 dividend yield of 4.8%.

Shareholder Returns

WBKUS BanksUS Market
7D-0.1%-0.5%-0.5%
1Y-5.0%32.9%13.7%

Return vs Industry: WBK underperformed the US Banks industry which returned 32.9% over the past year.

Return vs Market: WBK underperformed the US Market which returned 13.7% over the past year.

Price Volatility

Is WBK's price volatile compared to industry and market?
WBK volatility
WBK Average Weekly Movement3.9%
Banks Industry Average Movement3.7%
Market Average Movement6.6%
10% most volatile stocks in US Market15.9%
10% least volatile stocks in US Market2.4%

Stable Share Price: WBK is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: WBK's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
181740,143Peter Kinghttps://www.westpac.com.au

Westpac Banking Corporation provides various banking and financial services in Australia, New Zealand, the Americas, Asia, Europe, and internationally. It offers everyday banking, savings, term deposit, business transaction, foreign currency, and specialized accounts; home, personal, and business loans; credit cards; international and travel services; share trading services; investment; and home, car, travel, life, and business insurance products. The company also provides merchant and payment, 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.

Westpac Banking Fundamentals Summary

How do Westpac Banking's earnings and revenue compare to its market cap?
WBK fundamental statistics
Market CapAU$78.60b
Earnings (TTM)AU$5.46b
Revenue (TTM)AU$21.81b

14.4x

P/E Ratio

1.1x

P/B Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
WBK income statement (TTM)
RevenueAU$21.81b
Cost of RevenueAU$0
Gross ProfitAU$21.81b
ExpensesAU$16.36b
EarningsAU$5.46b

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

Feb 03, 2022

Earnings per share (EPS)1.49
Gross Margin100.00%
Net Profit Margin25.01%
Debt/Equity Ratio293.8%

How did WBK perform over the long term?

See historical performance and comparison

Dividends

5.6%

Current Dividend Yield

79%

Payout Ratio

Valuation

Is Westpac Banking undervalued compared to its fair value and its price relative to the market?

14.41x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: WBK ($15.54) is trading above our estimate of fair value ($14.9)

Significantly Below Fair Value: WBK is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: WBK is poor value based on its PE Ratio (14.4x) compared to the US Banks industry average (11.3x).

PE vs Market: WBK is good value based on its PE Ratio (14.4x) compared to the US market (17.4x).


Price to Earnings Growth Ratio

PEG Ratio: WBK is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: WBK is good value based on its PB Ratio (1.1x) compared to the US Banks industry average (1.2x).


Future Growth

How is Westpac Banking forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

9.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WBK's forecast earnings growth (9.7% per year) is above the savings rate (2%).

Earnings vs Market: WBK's earnings (9.7% per year) are forecast to grow slower than the US market (13% per year).

High Growth Earnings: WBK's earnings are forecast to grow, but not significantly.

Revenue vs Market: WBK's revenue (0.7% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: WBK's revenue (0.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WBK's Return on Equity is forecast to be low in 3 years time (10.4%).


Past Performance

How has Westpac Banking performed over the past 5 years?

-14.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WBK has high quality earnings.

Growing Profit Margin: WBK's current net profit margins (25%) are higher than last year (13.5%).


Past Earnings Growth Analysis

Earnings Trend: WBK's earnings have declined by 14.6% per year over the past 5 years.

Accelerating Growth: WBK's earnings growth over the past year (138.5%) exceeds its 5-year average (-14.6% per year).

Earnings vs Industry: WBK earnings growth over the past year (138.5%) exceeded the Banks industry 43.7%.


Return on Equity

High ROE: WBK's Return on Equity (7.6%) is considered low.


Financial Health

How is Westpac Banking's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet


Financial Institutions Analysis

Asset Level: WBK's Assets to Equity ratio (13x) is moderate.

Allowance for Bad Loans: WBK has a low allowance for bad loans (48%).

Low Risk Liabilities: 73% of WBK's liabilities are made up of primarily low risk sources of funding.

Loan Level: WBK has an appropriate level of Loans to Assets ratio (76%).

Low Risk Deposits: WBK's Loans to Deposits ratio (113%) is appropriate.

Level of Bad Loans: WBK has an appropriate level of bad loans (1.3%).


Dividend

What is Westpac Banking current dividend yield, its reliability and sustainability?

5.59%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: WBK's dividend (5.59%) is higher than the bottom 25% of dividend payers in the US market (1.32%).

High Dividend: WBK's dividend (5.59%) is in the top 25% of dividend payers in the US market (3.44%)


Stability and Growth of Payments

Stable Dividend: WBK's dividend payments have been volatile in the past 10 years.

Growing Dividend: WBK's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (79%), WBK's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WBK's dividends in 3 years are forecast to be covered by earnings (71.4% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.6yrs

Average management tenure


CEO

Peter King (51 yo)

2.08yrs

Tenure

AU$4,202,453

Compensation

Mr. Peter Francis King, BEc, FCA, has been the Chief Executive Officer & Managing Director of Westpac Banking Corporation since April 02, 2020 and served as its Acting Managing Director & Chief Executive O...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD3.04M) is below average for companies of similar size in the US market ($USD11.18M).

Compensation vs Earnings: Peter's compensation has increased by more than 20% in the past year.


Leadership Team

Experienced Management: WBK's management team is not considered experienced ( 1.6 years average tenure), which suggests a new team.


Board Members

Experienced Board: WBK's board of directors are not considered experienced ( 2.1 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Westpac Banking Corporation's employee growth, exchange listings and data sources


Key Information

  • Name: Westpac Banking Corporation
  • Ticker: WBK
  • Exchange: NYSE
  • Founded: 1817
  • Industry: Diversified Banks
  • Sector: Banks
  • Implied Market Cap: AU$78.598b
  • Listing Market Cap: AU$56.786b
  • Shares outstanding: 3.66b
  • Website: https://www.westpac.com.au

Number of Employees


Location

  • Westpac Banking Corporation
  • 275 Kent Street
  • Level 18
  • Sydney
  • New South Wales
  • 2000
  • Australia

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/01/16 23:28
End of Day Share Price2022/01/14 00:00
Earnings2021/09/30
Annual Earnings2021/09/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.