NAB Delivers Stellar 2024 Returns, Outperforming ASX 200

2 min read | January 03, 2025 12:13 PM AEDT | By Team Kalkine Media

NAB Delivers Stellar 2024 Returns, Outperforming ASX 200 — Image source: shutterstock

Exceptional Shareholder Returns

NAB rewarded investors with two fully franked dividends in 2024:

84 cents per share (interim) paid in July.
85 cents per share (final) distributed in December.

These dividends represented a 5.5% yield, which, combined with the robust share price growth, turned a $20,000 investment at the start of 2024 into over $25,000 by year-end.

What Drove NAB’s Success?

Better-Than-Expected Earnings

Despite an 8.1% drop in cash earnings to $7.1 billion and a 2% decline in revenue, NAB’s performance surpassed bearish forecasts. Key highlights include:

Volume growth and higher fee income offsetting declines in net interest margins and Markets & Treasury income.
Low levels of bad debts, easing concerns about the impact of rising interest rates.

Housing Market Momentum

Australia’s thriving housing market further boosted confidence in NAB, providing a tailwind for the bank and its peers among the big four.

2025: What Lies Ahead for NAB?

Mixed Analyst Sentiment

While many brokers view NAB as overvalued, Morgan Stanley remains bullish, maintaining an overweight rating and a price target of $38.40, slightly above its current share price of $37.47.

Key Factors to Monitor

Interest Rate Movements: Their effect on net interest margins could be pivotal.
Housing Market Trends: Sustained strength would benefit NAB’s loan book.
Economic Conditions: Any uptick in bad debts could dampen performance.

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