This report is an updated version of the report published on 19 June 2025 at 12:15 PM AEST.

National Australia Bank Limited (ASX: NAB)

NAB is one of Australia’s largest financial institutions, offering comprehensive banking and financial services across Australia, New Zealand, and globally. With a focus on business and personal banking, NAB supports individuals, small businesses, and large corporations through innovative digital platforms and dedicated customer service.

Recommendation Rationale – SELL at AUD 39.230

• Negative Financials: Interest income, calculated using the effective interest rate method, saw a slight decrease to AUD 25,625mn in 1HFY25 from AUD 26,175mn in 2HFY24. Similarly, net profit for the period also declined to AUD 3,427mn in 1HFY25 from AUD 3,475mn in 2HFY24, primarily due to lower other operating income during the same period.
• Trading Near the Resistance: NAB stock has surpassed its R1 level recommended on 1 May 2025. Therefore, share price can face resistance at the current levels.
• Overvalued Multiples: On a forward 12-month basis – key trading multiples (EV/Sales, Price/Book, and Price/Earnings) are higher than median of the financials sector.
• Market Risk: Increased trade tensions and tariffs, especially between the US, China, and their partners, could disrupt global trade, impacting NAB’s customers exposed to commodity prices, exchange rates, and trade flows.

NAB’s Daily Price Chart

Valuation Methodology: Price/Book Value Approach (FY Sept'26E) (Illustrative)

Stock might trade at a slight premium to its peers considering the bank’s strategic focus on core lending, YoY increase in net interest income and basic cash EPS in 1HFY25, rising share in SME lending, and other contributing factors. For conducting the valuation, following peers have been considered: Westpac Banking Corp (ASX: WBC), Kina Securities Ltd (ASX: KSL), ANZ Group Holdings Ltd (ASX: ANZ), among others.

Considering that the stock has surpassed its R1 level, macroeconomic uncertainty, rally in share price movement, current trading level, and risks associated, the share price can face consolidation at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current price of AUD 39.230, as of 19 June 2025, at 11:20 AM AEST).

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 19 June 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Note 5: Dividend Yield may vary as per the stock price movement.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.