ASX bank stocks have slumped across the board over the past month as geopolitical tensions, ongoing conflict in the Middle East, soaring fuel prices, and interest rate growth cause concerns about an economic slowdown.
The Reserve Bank raised the official cash rate by 25 basis points to 4.10% this month, marking the second consecutive increase in 2026. The bank cited persistent inflationary pressures and a tight labour market for the increase.
Now the experts are warning that Australia's inflation rate could keep climbing, and major banks widely predict another cash rate increase in May.
What's the latest out of ASX bank stocks?
The Australian share market is dominated by the big 4 major banks. Together, the majors – Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB), and ANZ Group Holdings Ltd (ASX: ANZ) – make up around a quarter of the S&P/ASX 200 Index (ASX: XJO) by market capitalisation.
Then there are the smaller players, Macquarie Group Ltd (ASX: MQG), Bank of Queensland Ltd (ASX: BOQ), Bendigo and Adelaide Bank Ltd (ASX: BEN), and Judo Capital Holdings Ltd (ASX: JDO).
At the time of writing on Wednesday morning, CBA shares are up 1% to $172.86; Westpac shares are up 1.3% to $40.25; NAB shares are up 1.4% to $40.31; and ANZ shares are up 1.3% to $36.93.
Over the month, the major bank shares are down 3%, 6.2%, 11.8%, and 7%, respectively.
Outside of the majors, Macquarie shares are 1.9% higher at the time of writing to $198.71; BOQ shares are 1% higher at $6.83 a piece; Bendigo shares are 0.6% higher at $10.11 each; and Judo shares have climbed 0.3% to $1.48.
Over the month, the smaller bank shares are down 4%, 2%, 6.5% and 14% respectively.
Which ASX bank stocks are a buy?
Analysts are the most optimistic about the outlook for Judo Bank shares. It's the only ASX bank stock where analysts mostly hold a strong buy rating. Its average target price is $2.25, which implies a huge 51% upside at the time of writing. Although some think this could jump even higher, by up to 68% to $2.50 per share.
Sentiment on the outlook for Macquarie shares is mostly very positive. Most analysts have a buy or strong buy rating on the bank's shares. The average $238.28 target price implies the shares could jump 21% from here.
Which ASX bank stocks are a hold?
Analysts are undecided about the outlook for NAB shares, with sentiment mostly for a hold rating. The average target price is $43.90, which implies a potential 1.88% downside at the time of writing.
Brokers are also neutral on the outlook for ANZ shares over the next 12 months. Most have a hold rating and the average target price of $35.56 which implies a potential 0.3% downside at the time of writing.
Sentiment is also neutral on BOQ shares with data showing most analysts have a hold rating on the stock. However the average $6.37 target price implies a potential 6.5% downside at the time of writing.
Analysts also mostly have a hold rating on Bendigo shares. Although its average $10.41 target price implies a 3% upside at the time of writing.
Which ASX bank stocks are a sell?
Sentiment is that CBA shares are overpriced and out of keeping with the company's fundamentals. Most analysts have a sell or strong sell rating on CBA shares and are tipping an average downside of 23% to $133.85 a piece over the next 12 months, at the time of writing.
Westpac is also expected to have limited growth over the next few years. Most analysts also have a sell or strong sell rating on the ASX bank's shares and tip an average downside of 8% to $40.35.
The post ASX bank stocks: Buy, sell, or hold? appeared first on The Motley Fool Australia.
Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Bendigo And Adelaide Bank and Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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