National Australia Bank Limited | NAB | Banks | ASX
Performance | Valuation | Growth | Summary | Balance Sheet | Income Statement | Cash Flow
A$ in Million. Fiscal year ends in September. Figures are consolidated and restated.
Intrinsic value and stock valuation
Market Capitalization and Net Worth
Net worth also called as "Shareholder Equity", "Stockholder's Equity", "Net Asset Value" or "Book Value". It essentially means total assets minus total liabilities.
The above chart displays the share price and the book value per share. Generally the share price is above the book value price but during a recession (e.g. 2008) or due to some other factors, the share price can go below the book value per share. Smart bargain investors buy shares when the current market price is below the book value i.e. the stock is undervalued but at the same time you have to ask yourself why the current market price is going below the book value price. Is it because of some serious fundamental problems with the company?
Current Market Price : $24.60 on 26-February-2019
Market Capitalization of National Australia Bank Limited is $ ___ (Sign up for Premium Service to see the market capitalization.)
Market Capitalization = Share price x No. of shares ( theoretical price at which you can buy the whole company )
Stock Valuation Models
Current & Historical Price to Earnings Ratio of National Australia Bank Limited
The P/E ratio looks at the relationship between the stock price and the company's earnings. The higher the P/E the more the market is willing to pay for the company's earnings.
By comparing price and earnings per share for a company, one can analyze the Market's stock valuation of a company and its shares relative to the income the company is actually generating. It is usually used to compare the P/E ratios of one company to other companies in the same industry sector. Ideally you should avoid investing in a company which has a PE Ratio greater than 20.
National Australia Bank Limited Average PE Ratio is 14.6. Current PE is 13.1% lower than long term average
PE Ratio Valuation
Price per share = 10 Years Median P/E Ratio x EPS
National Australia Bank Limited's median P/E ratio for the last 10 years was 14.6 times, it's EPS is $1.9 which gives us an intrinsic value of $28 per share.
EPS Growth Valuation
Similar to Free cash flow valuation model we project the Earnings Per Share for the next ten years. Then we use an estimated Price/Earnings ratio to calculate the future stock price which is then discounted back to present value giving us an intrinsic value per share.
Multi Year EPS Compound Annual Growth Rate
| Years | 2013-2015 | 2014-2016 | 2015-2017 | 2013-2016 | 2014-2017 |
|---|---|---|---|---|---|
| EPS Growth | 5.8 % | -79.9 % | -12.2 % | -65.9 % | -4.2 % |
Multi-Year Average EPS Growth Rate : -12.21%
EPS Growth Valuation model cannot be calculated if Earnings per share growth rate is negative.
Graham Number Valuation
Graham Number was created by Benjamin Graham, the father of value investing. It calculates the stock's maximum fair value based of its Earnings per share and Book value per share. Stocks trading below their Graham Number may be undervalued.
Graham's Fair Value Price = Square Root of (22.5 x EPS x BVPS)
National Australia Bank Limited's intrinsic fair value price per share is $29.07
Note - Graham number is useful for companies which depend more on their tangible assets (e.g. Manufacturing, Oil & Gas). It is not so useful for companies which depend more on their intangible assets (e.g. Pharma, IT).
Intrinsic Fair Value Share Price Range for National Australia Bank Limited
| PE Ratio valuation | $28.37 |
| EPS Growth Valuation | N.A. |
| Graham Number | $29.07 |
| Book Value | $19.26 |
| Average Fair Value | $28.37 |
| 30% Margin of Safety | $19.86 |
| Current market price | $24.60 |
Note - Margin of safety is a principle of investing in which an investor purchases stock only when the market price is significantly below its intrinsic value. This difference allows an investment to be made with minimal downside risk.
Note - Adjusted PE Ratio is calculated as Current market price / 3 year median EPS.