ASX Bank Shares Navigate Earnings Season: Mixed Fortunes for Major and Regional Lenders
Australian bank shares are showing resilience on Friday, with the S&P/ASX 200 Banks Index (ASX: XBK) trading up 0.43%, bucking a slight downturn in the broader S&P/ASX 200 Index (ASX: XJO), which is down 0.13%. As the crucial earnings season draws to a close, with all scheduled bank reports now in, market analysts and brokers are busy recalibrating their assessments and 12-month price targets for these key financial institutions. This period of intense financial disclosure has provided a clearer picture of the banking sector’s performance, revealing distinct outcomes for both regional and major players.
Bendigo and Adelaide Bank Ltd (ASX: BEN): A Challenging Half-Year Sees Share Price Dip
Bendigo and Adelaide Bank Ltd (ASX: BEN) experienced a notable drop in its share price, falling 3.5% to $11.04 on Friday. This movement follows the release of its first-half FY26 cash earnings, which stood at $256.4 million. While this represented a modest 2.8% increase compared to the latter half of FY25, it marked a 3.3% decrease when measured against the first half of FY25. The market’s reaction on the day of the report was swift, with the ASX 200 bank share declining by 2.2%.
Following these results, a raft of brokers have updated their ratings and price expectations for Bendigo Bank shares:
- Ord Minnett maintained its “buy” recommendation and adjusted its 12-month price target upwards from $11 to $11.50.
- Jarden reiterated a “hold” rating, setting a price target of $11.
- UBS also held its “hold” rating, with a target price of $10.95.
- Jefferies reaffirmed its “hold” stance and saw its price target rise from $9.51 to $9.64.
- Citi maintained its “sell” rating but slightly increased its price target from $10.25 to $10.50.
- Morgan Stanley continued with a “sell” rating, assigning a price target of $10.40.
- Macquarie echoed the “sell” sentiment, with a price target of $10.
It’s worth noting that the Bendigo and Adelaide Bank share price has seen higher valuations, having traded at a 52-week high of $13.73 in August of last year.
ANZ Group Holdings Ltd (ASX: ANZ): Strong Quarterly Performance Drives Share Gains
In contrast to Bendigo Bank, ANZ Group Holdings Ltd (ASX: ANZ) has enjoyed a positive trajectory, with its shares climbing 0.9% to $40.43 on Friday. This performance is underpinned by a robust first-quarter FY26 cash profit of $1.94 billion, a figure that represents a significant 75% surge compared to the average quarterly profit in the second half of FY25.
ANZ’s management attributed this strong profit to a combination of factors, including a 4% uplift in operating income and a substantial 21% reduction in operating expenses. The market’s enthusiasm was evident immediately after the report, with the ASX 200 bank share soaring by 8.5% on the day of the announcement. The positive momentum continued, with ANZ shares reaching a new record high of $41 per share the following day.
Following a thorough review of ANZ’s financial disclosures, industry experts have updated their recommendations and price targets:
- Jarden maintained its “buy” rating, setting a price target of $35.
- Morgan Stanley upgraded ANZ to a “buy” rating and significantly raised its 12-month share price target from $36.30 to $41.30.
- Macquarie kept its “hold” rating for the ASX 200 bank share, with a price target of $37.
- Jefferies reiterated its “hold” rating on ANZ shares, assigning a price target of $34.55.
- Morgans downgraded its rating to “sell” but marginally increased its target from $32.57 to $32.65.
- Ord Minnett maintained its “sell” rating, with a price target of $33.
- UBS retained a “sell” rating, while also lifting its target from $35 to $36.50.
The contrasting performances of Bendigo and Adelaide Bank and ANZ Group Holdings highlight the varied impacts of earnings season across the Australian banking landscape. While some institutions are facing headwinds and cautious analyst sentiment, others are demonstrating strong operational performance and capturing market favour. Investors will be closely watching how these trends evolve as the financial year progresses.
