Bank of Nova Scotia (BNS.TO)

The worst of the sector, but he bought some yesterday. Their earnings are good and he expects a rate hike next week to boost all Canadian banks. Buy now when it's down. It's an emerging market play, and EM is out of favour, which is a
buying opportunity. Pays a 4.7% dividend.

He sold it, because it disappointed. He prefers TD, RY, and JPM and BAC in the States. He doesn't know why BNS is underperforming.

It is a pretty good long term hold. It recently developed a downward channel. It may hold around $70, as the seasonality kicks in. There are stronger names, however. There are better names to get into right now.

Have been on an acquisition binge. Business is slowing down in the Caribbean. If investing in Canadian banks, half positions only because of inflation and slowdowns in mortgages and the Canadian economy. He isn’t really aggressive with banks because the yield curve is not in their favour.

It is within about 5% of setting a new low. It appears to be the poorest ranked stock in his model. They had problems in the Caribbean.

Been adding to it. BNS has underperformed its peers. Recently did an equity issue to fund acqusition in the global management side. So, its been taking a breather in its stock. Likes Canadian banks which have a good year in reporting. Overhangs were NAFTA and real estate where rising interest rates pressure mortgages. Banks have diversified businesses and are performing well; and are investing in technology. All are raising dividends.

Like any of the Canadian banks he feels they have a place in the portfolio. They have the biggest exposure to emerging markets and that affected them negatively recently given what has been happening in South America. They don’t hold it but think it will do well.

(A Top Pick Aug 11/17, Up 3%) Thinks the market’s wrong, overreacted. Second-largest bank in Mexico, so the new NAFTA should help them. Growth in Central and South Americas should help them. A good time to get in.

Likes it for the international exposure. Excellent longer-term strategy of making acquisitions in Central and South America. Good way to diversify into banking outside of Canada. Yield is better than other banks. Not a bad time to buy. A buy and hold, clip your coupon stock. Yield is 4.5%. (Analysts’ price target is $85.27.)

Generally with NAFTA behind us and LNG being developed, he sees Canada being a favorable investment again – including the banks. BNS-T has been the biggest dog in the bank sector, due to its exposure into some difficult international markets. He likes the valuation the best. It may be time to buy.

It recently took a hit on earnings, because it had bought a large Spanish bank's Chilean operations, making it the second-biggest bank in Chile, and took an immediate writedown, which hit the topline numbers. BNS also bought MD Financial for $2.5 billion as well as investment firm Jarislowsky Fraser for $1 billion, so they issued a lot of stock to cover those. But their yield continues to rise, the highest of the Canadian banks. The rule is buy the worst performer in one year, and it becomes the best performer in the future. (4.5% dividend, Analysts' price target: $85.46)

(A Top Pick October 3/17 Up 0.4%) There was a nice rally from the mid-$70 level earlier this month. Still good value and he continues to be a buyer. Yield 4.4%

He just wrote about it. He owns BNS and CIBC, a contrarian play. BNS has bounced off $74 a few time then had a nice rally. Canadian banks do well in mid-November into winter. This should catch up to the low-$80s. Has little risk. Don't expect a big uptrend, though. A good short-term play.

Worst performer of all the banks for the year. They made two big acquisitions in the wealth management. He thinks it is a screaming buy here. You can’t be too pessimistic on the Canadian Economy. (Analysts’ price target is $86.46)

The caller asked him to compare investing in ScotiaBank with investing in large cap American banks. In his 40 years in this business, most US banks have been bankrupt at least once, whereas the Canadian banks have not. The difference is the stronger regulatory system up here. He does own Morgan Stanley, which is a large US bank. ScotiaBank has been weak this year because of a few acquisitions and because of exposure in South America. There are fears that this might not do as well as expected. He is continuing to buy the stock but thinks it might be a few more quarters before people feel comfortable investing in South America. Events in Venezuela, for example, are causing disruptions in nearby countries, if only from the flow of emigrants.