BUY HOLD SELL – National Australia Bank (ASX: NAB)

NAB has released its 2022 full-year results, cash earnings up 8.3%, underlying profit up 11.5%.

NAB Full-year results

  Cash earnings rose 8.3%   Underlying net profit rose 11.5%   Net Interest Margin (NIM) decreased by 6 basis points to 1.65% (better than Westpac)   Expenses increased 5.8%   Final dividend of 78c per share. 151c for the year.


The CEO Ross McEwan stated, “the bank is well positioned for what is ahead”. During the same period, NIM decreased by 6 basis points to 1.65%, primarily reflecting the higher earnings on deposits due to the rise in interest rates, with was mostly offset by home lending competition. Expenses increased 5.8% as wages,  technology and remediation costs increased.  

The Good and the Bad (no ugly)

  • Good CEO comment - “Execution of our strategy has delivered good volume momentum. This, combined with benefits from a rising interest rate environment and a balanced approach to cost discipline while investing for growth, has driven strong underlying profit growth in FY22.”
  • Bad CEO comment - “Consumption and overall growth are expected to soften from September 2022 as the impact of higher interest rates and inflation impact household budgets more heavily”.
Share price down 2.5% first thing but rallying in a market up 0.4%.
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The share price looks like it's topping out as the banks often do over results and dividends. As income stocks, there's not much to look forward to (they are not growth stocks) between dividends and post going ex-dividend the pre-dividend buying unwinds. It is no major issue, it's just that the sector tends to go quiet after so much newsflow. Brokers will be telling clients to sell NAB (and WBC) after they go ex-dividend (NAB - November 15, WBC November 17) and buy CBA (the next bank to go ex-dividend in February. NAB chart  

STOCK BOX - The numbers

NAB stock box


FORWARD PE history is the blue line, horizontal blue line is the average over the period, orange line is the share price. NAB PE is down from over 16x to 12.8x in line with the five-year average. NAB PE history  


NAB 20 year yield


To read the conclusion and to get access to more market commentary, sign up for a free trial now and become a better investor.     Marcus Padley More about the author – Marcus Padley Marcus Padley is a highly-recognised stockbroker and business media personality. He founded Marcus Today Stock Market Newsletter in 1998. The business has built a community of like-minded investors who want to survive and thrive in the stock market. We achieve that through a combination of daily stock market education, ideas and activities.

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