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Westpac Banking
(Sydney:WBC)
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Rating:55Neutral
Price Target:
AU$36.00
▲(5.82% Upside)
Action:Reiterated
Date:09/06/26
The score is driven primarily by mixed financial quality: steady profitability and ROE are offset by rising leverage and highly volatile cash flows. Technical indicators are a secondary headwind with the stock trading below key moving averages and a negative MACD. Valuation is a partial support due to a moderate P/E and a solid dividend yield.
Positive Factors
Resilient Profitability
Consistent earnings across the cycle indicate that Westpac's core banking franchise has maintained profitability through changing conditions. The combination of resilient net income and healthy operating margins supports ongoing capital generation and provides a durable base for serving customers and investing in operations.
Negative Factors
Rising Balance-Sheet Leverage
The increase in leverage raises Westpac's sensitivity to weaker credit conditions, higher funding costs and pressure on asset quality. Greater balance-sheet gearing can also constrain flexibility, because more capital and liquidity management may be needed to absorb stress or support future growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Resilient Profitability
Consistent earnings across the cycle indicate that Westpac's core banking franchise has maintained profitability through changing conditions. The combination of resilient net income and healthy operating margins supports ongoing capital generation and provides a durable base for serving customers and investing in operations.
Read all positive factors
Westpac Banking (WBC) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$118.40B
Dividend Yield4.5%
Average Volume (3M)4.76M
Price to Earnings (P/E)16.8
Beta (1Y)1.07
Revenue Growth-3.87%
EPS Growth1.20%
CountryAU
Employees33,305
SectorFinancial
Sector Strength70
IndustryBanks - Diversified
Share Statistics
EPS (TTM)2.05
Shares Outstanding3,420,303,200
10 Day Avg. Volume4,168,247
30 Day Avg. Volume4,757,090
Financial Highlights & Ratios
PEG Ratio38.78
Price to Book (P/B)1.83
Price to Sales (P/S)2.30
P/FCF Ratio9.84
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$34.01Price Target Upside-0.03% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering8
EPS Forecast (FY)2.11
Revenue Forecast (FY)AU$23.49B
Westpac Banking Business Overview & Revenue Model
Company Description
Westpac Banking Corporation, an established financial institution headquartered in Sydney, Australia, has provided a comprehensive suite of banking and financial solutions since its founding in 1817 (initially as Bank of New South Wales, rebranded...
How the Company Makes Money
Westpac primarily makes money by earning interest and fees from providing banking products and financial services.
1) Net interest income (core earnings driver)
- Westpac takes deposits (e.g., savings, term deposits, transaction accounts) and oth...
Westpac Banking Earnings Call Summary
Earnings Call Date:Nov 02, 2025
(Q4-2025)
| Next Earnings Date:Nov 02, 2026
Earnings Call Sentiment Neutral
Westpac demonstrated strong growth in deposits and business lending, and launched significant digital innovations. However, the company faced challenges with decreased net profit, increased expenses, and delays in the UNITE program. Customer and brand advocacy continue to require attention.Positive Updates
Strong Deposit Growth
Consumer deposits grew by 10%, reflecting the effectiveness of Westpac's banking app and competitive product suite.
Negative Updates
Decrease in Net Profit
Net profit, excluding notables, decreased by 2% to $7 billion, and statutory net profit fell by 1% to $6.9 billion.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Deposit Growth
Consumer deposits grew by 10%, reflecting the effectiveness of Westpac's banking app and competitive product suite.
Read all positive updates
Company Guidance
During Westpac's Full Year 2025 Results Briefing, the company provided guidance on various financial metrics and strategic initiatives. Net profit, excluding notable items, decreased by 2% to $7 billion, while statutory net profit fell by 1% to $6.9 billion. The return on tangible equity experienced a slight contraction, partly cushioned by a share buyback. The cost-to-income ratio rose to 53% due to higher expenses driven by their transformation agenda, although efforts under the Fit for Growth program aim to offset this in FY '26. The Board declared a second half dividend of $0.77, contributing to a full-year dividend of $1.53 per share, equating to a payout ratio of 75% of profit after tax, excluding notable items. The company continues to focus on streamlining operations through the UNITE program, with an investment of $660 million in FY '25, slightly above guidance, and plans to invest between $850 million and $950 million in FY '26. Westpac also highlighted improvements in customer service metrics, such as a 30% reduction in financial market clients' time to trade in the Commercial division and a 21% decline in reported customer scam losses, thanks to new initiatives like SafeCall and SafeBlock. Additionally, the company sees promising growth in consumer deposits, which grew by 10%, supported by their award-winning banking app and competitive product suite.Westpac Banking Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
58
Neutral
Cash Flow
47
Neutral
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 56.26B | 57.90B | 21.05B | 21.00B | 19.27B | 21.81B |
| Gross Profit | 22.18B | 21.81B | 21.05B | 20.73B | 20.09B | 21.59B |
| EBITDA | 11.15B | 10.59B | 11.63B | 11.78B | 10.17B | 12.66B |
| Net Income | 7.01B | 6.91B | 6.98B | 7.20B | 5.69B | 5.46B |
Balance Sheet | ||||||
| Total Assets | 1.17T | 1.13T | 1.08T | 1.03T | 1.01T | 935.88B |
| Cash, Cash Equivalents and Short-Term Investments | 53.49B | 122.64B | 168.07B | 176.87B | 181.02B | 70.91B |
| Total Debt | 225.71B | 232.44B | 207.17B | 138.20B | 126.71B | 113.17B |
| Total Liabilities | 1.10T | 1.05T | 1.01T | 957.24B | 943.69B | 863.78B |
| Stockholders Equity | 70.76B | 72.77B | 71.70B | 72.50B | 70.45B | 72.03B |
Cash Flow | ||||||
| Free Cash Flow | 18.23B | 13.55B | -1.17B | -35.73B | -18.27B | 16.44B |
| Operating Cash Flow | 18.57B | 13.93B | -933.00M | -35.49B | -18.10B | 16.67B |
| Investing Cash Flow | -102.49B | -68.45B | -80.24B | 1.71B | 2.81B | 5.62B |
| Financing Cash Flow | 80.27B | 39.20B | 45.08B | 30.35B | 48.29B | 18.64B |
Westpac Banking Technical Analysis
Negative
34.02
Price Trends
35.10
Negative
35.52
Negative
37.24
Negative
Market Momentum
-0.12
Negative
45.02
Neutral
43.03
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:WBC, the sentiment is Negative. The current price of 34.02 is below the 20-day moving average (MA) of 34.54, below the 50-day MA of 35.10, and below the 200-day MA of 37.24, indicating a bearish trend. The MACD of -0.12 indicates Negative momentum. The RSI at 45.02 is Neutral, neither overbought nor oversold. The STOCH value of 43.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:WBC.
Westpac Banking Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | AU$114.06B | 19.19 | 8.30% | 4.37% | -5.34% | -13.04% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
63 Neutral | AU$120.31B | 19.36 | 9.88% | 4.43% | -8.10% | -10.70% | |
62 Neutral | AU$92.01B | 19.56 | 13.72% | 2.81% | 4.80% | 30.56% | |
55 Neutral | AU$118.40B | 16.82 | 9.77% | 4.50% | -3.87% | 1.20% | |
55 Neutral | AU$5.95B | 15.56 | 5.61% | 6.16% | -5.79% | ― | |
54 Neutral | AU$254.75B | 23.16 | 13.94% | 3.36% | 0.78% | 7.41% |
* Financial Sector Average
AU:WBC
Westpac Banking
34.24
-3.52
-9.33%
AU:ANZ
ANZ Group Holdings
37.95
5.07
15.43%
AU:BEN
Bendigo & Adelaide Bank
10.22
-2.21
-17.78%
AU:MQG
Macquarie Group Limited
248.77
33.50
15.56%
AU:NAB
National Australia Bank Limited
38.40
-4.19
-9.84%
AU:CBA
Commonwealth Bank of Australia
150.37
-14.04
-8.54%
Westpac Banking Corporate Events
Westpac Raises A$1.5 Billion Through New Tier 2 Subordinated Notes
Aug 20, 2026
Westpac Banking Corporation has issued A$1.5 billion in Tier 2 subordinated notes, comprising a A$250 million fixed-to-floating tranche and a A$1.25 billion floating-rate tranche, both callable and due in August 2036. The notes form part of Westpa...
Westpac Director Miller Sells Shares to Cover Tax on Equity Awards
Aug 18, 2026
Westpac Banking Corporation, a leading Australasian banking and financial services provider, offers a broad suite of retail, commercial, and institutional products, and routinely grants share rights and equity awards to executives to align their i...
Westpac publishes June 2026 Pillar 3 regulatory report
Aug 9, 2026
Westpac has released its Pillar 3 Report as at 30 June 2026, providing detailed regulatory disclosures in line with APS 330 requirements. The publication underscores the bank’s ongoing adherence to prudential standards and transparency oblig...
Westpac Releases Third Quarter 2026 Investor Discussion Pack
Aug 9, 2026
Westpac Banking Corporation has released its Third Quarter 2026 Investor Discussion Pack, providing analysts and shareholders with detailed financial and risk information for the three months ended 30 June 2026. The materials, which are presented ...
Westpac strengthens capital with $15.4bn RAMS mortgage portfolio sale
Aug 2, 2026
Westpac has completed the sale of its $15.4 billion RAMS mortgage portfolio to a consortium including Pepper Money and funds managed by KKR and PIMCO, marking a significant divestment from its non-core lending operations. The deal strengthens West...
Westpac Issues New Shares Following Conversion of Unquoted Securities
Jul 14, 2026
Westpac Banking Corporation has notified the market of the issue of 31,051 ordinary fully paid shares, following the conversion or exercise of previously unquoted options or other convertible securities. The new shares, recorded under the ASX code...
Westpac Issues New Unquoted Share Rights Under Staff Incentive Plan
Jul 14, 2026
Westpac Banking Corporation has notified the market of the issue of 41,732 unquoted share rights under its employee incentive scheme. The share rights, designated as WBCAB, were issued on 30 June 2026 and are not intended to be quoted on the ASX.T...
Westpac Reports Lapse of 584 Conditional Share Rights
Jul 14, 2026
Westpac Banking Corporation has notified the market of a minor adjustment to its issued capital, following the lapse of 584 share rights. The rights, designated as WBCAB securities, ceased on 30 June 2026 after the conditional requirements attache...
Westpac Issues JPY 13bn Tier 2 Subordinated Notes to Bolster Regulatory Capital
Jun 10, 2026
Westpac Banking Corporation has issued JPY 13 billion of 2.708% fixed-to-fixed rate reset callable subordinated instruments due June 2036, structured to qualify as Tier 2 regulatory capital under the Basel III framework as applied by APRA. The ins...
Westpac Discloses 0.27% Voting Stake Held by Controlled Entities
Jun 10, 2026
Westpac Banking Corporation has disclosed that its controlled entities collectively hold or control 0.27% of the bank’s voting shares, under an exemption granted by the Australian Securities and Investments Commission. This position is sprea...
Westpac Redeems $5 Hybrid Debt Tranche at Scheduled Maturity
Jun 10, 2026
Westpac Banking Corporation has notified the market of the cessation of a tranche of its quoted debt securities, following the scheduled repayment or redemption of 1,000,000 units of its 0.76% notes maturing on June 9, 2026. The move reflects the ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.