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Commonwealth Bank (CBA) v ANZ Bank (ANZ) – Revisited

We have been discussing a potential switch from the ex-dividend CBA into cum-dividend ANZ over recent weeks and the move remains on the radar:

  • ANZ is up 1.8% so far in 2022 while CBA is up 7.3% plus Australia’s largest bank has paid an appetizing $1.75 fully franked dividend in February making its outperformance even more impressive.

However as todays title alludes to stock / sector trends have rarely reversed in 2022 begging the question is it too early to switch from CBA to ANZ, individually we like both but ANZ does appear to have slightly more upside although there is the risk of a disappointing result come early May:

  • MM is long CBA still targeting a strong break above its $110.19 November high, another 10% upside wouldn’t surprise.
  • ANZ is forecast to pay a 75c fully franked dividend in May putting it on a 7.2% grossed up yield, similarly we are looking for around 10-15% further upside.

Since we last considered this switch ANZ has rallied 40c / 1.4% compared to $2.58 / 2.4% by CBA, certainly an improvement but we need more to feel compelled to press the switch button.

CBA
MM remains bullish both CBA and ANZ
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Commonwealth Bank (CBA) v ANZ Bank (ANZ)
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