Are BEN shares worth considering in September?

Core Insights - Bendigo & Adelaide Bank Ltd's share price is under scrutiny as ASX investors attempt to establish a price target for the company [1][2] - The Australian banking sector has been popular since the early 1990s, with major banks comprising approximately 30% of the share market by market capitalization [2] Valuation Methods - The PE ratio is a common method for valuing bank shares, comparing the share price to earnings per share [3][4] - Bendigo & Adelaide Bank Ltd's current PE ratio is calculated at 14.8x, which is lower than the banking sector average of 19x, suggesting a potential undervaluation [5] Dividend Valuation - The Dividend Discount Model (DDM) is a robust method for valuing banks, using recent or forecasted dividends and a risk rate [6][7] - Using a DDM approach, the valuation of Bendigo & Adelaide Bank Ltd shares is estimated at $13.32, with an adjusted dividend payment leading to a valuation of $13.75 [10] - Considering fully franked dividends, the valuation could rise to $19.64 based on a forecast gross dividend payment of $0.93 [11] Growth and Risk Analysis - Different growth and risk rates yield varying valuations, with a risk rate of 6% and a growth rate of 2% resulting in a valuation of $16.25 [12] - The analysis emphasizes the importance of assessing net interest margins, regulatory challenges, and management culture when evaluating bank shares [13]