As interest rates go up so will the price of NABHA's. They are currently yielding 6.1%, a 2.8% margin over 90 day bank bills. If bank bills go to 6% they will be yielding 10% (7.25 coupon) a 4% margin. A 2.8% margin would give a price of 82c.
As we get through the bad debt cycle I believe the margin will decline resulting in a higher price. I also believe in a couple of years time the banks will be overcapitalised (JBWere are forecasting NAB's FY12 tier 1 ratio to be 9.7%) and a buyback has too be a possibility (the only alternative would be to buy back shares), not necessarily at face value, but say 90c.
As interest rates go up so will the price of NABHA's. They are...
Add NAB (ASX) to my watchlist
 (20min delay)
|
|||||
|
Last
$35.63 |
Change
0.320(0.91%) |
Mkt cap ! $109.9B | |||
| Open | High | Low | Value | Volume |
| $35.73 | $35.79 | $35.43 | $76.33M | 2.142M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 1 | 10799 | $35.61 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $35.68 | 2800 | 1 |
View Market Depth
| Last trade - 16.10pm 09/08/2024 (20 minute delay) ? |
| NAB (ASX) Chart |