Morgan Stanley analyst Richard Wiles has upgraded Australia and New Zealand Banking Group (ASX:ANZ) stock, but downgraded its smaller rival Bank of Queensland (ASX:BOQ).
ASX bank shares are on the radar of many investors amid increasing interest rates, which can lead to better profit margins in their lending businesses. However, they can prove a double-edged sword, as they have the potential to lead to widespread loan defaults, if rapidly rising rates lead to a recession.
How does Morgan Stanley’s Richard Wiles view ANZ and BOQ shares?
Wiles thinks that ANZ has better prospects than its competitor BOQ. The analyst downgraded BOQ stock to a Hold from a Buy. On the other hand, Wiles upgraded ANZ stock to a Buy from a Hold. The analyst assigned ANZ stock a price target of AU$26.90, which suggests 4.6% upside potential. Wiles has had a good track record with ANZ stock, with his recommendations resulting in profitable trades 82% of the time.
ANZ insiders are excited about the stock
The analyst’s upgrade comes at a time when ANZ insiders, such as directors and executives, have been showing confidence in the stock. TipRanks’ Insider Trading Activity tool shows that the Insider Confidence Signal is currently Very Positive on ANZ. The company’s corporate insiders have purchased AU$124,100 worth of shares in the past three months.
ANZ stock price prediction
According to TipRanks’ analyst rating consensus, ANZ stock is a Moderate Buy based on seven Buys, two Holds, and one Sell. The average ANZ share price prediction of AU$26.99 implies about 5% upside potential.
Moreover, ANZ stock scores a “Perfect 10” from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
Final thoughts
According to Tipranks insights, analysts generally believe that both ASX bank shares ANZ and BOQ are worth considering for a long-term portfolio. However, Morgan Stanley’s, Wiles is more impressed by ANZ stock.
