Laurentian Bank (LB.TO)

Stay with it if you are going to hold it. You have the safety and a combination of yield and growth. This one has better leverage in it. They had a sizeable correction in the last few months.

He does not presently own this now, because he does not think this is cheap. Although off the highs, he still thinks there is more risk in Canadian banks. The dividend is great and this would make it worthwhile. He prefers the US banking sector. Yield 5.25%.

Compared to National Bank: Laurentian has a much lower valuation at 8x forward earnings, and a discount to book value. Laurentian could be what National was two years ago.

He is not sure of the fundamental issues at the moment. He is concerned about the amount of credit outstanding for banks in general. Price targets by the analysts for this stock are seen as being a speculative buy by some – something you rarely see for a bank in Canada.

A value and contrarian pick. The stock has been falling. In recent quarters there was mis-reporting, so they had to pay some penalties, but by the next quarter we should have a clear picture of this problem. Trading at 8x forward earnings, below book value with a 5.5% yield. They will turn around. You're getting paid to wait. (Analysts' price target $55.70)

Don’t own it. It got caught up with some issues relating mortgage origination. And that hurt the stock. Too much uncertainty for now.

This company is the runt of the Canadian banks. It could trade up to $54. Going back 30 years the data says it always trades here, he says, so don’t get sucked into the higher yield. Yield 5%

National Bank or Canadian Western Bank or Laurentian? Definitely National. It's growing in asset management and spending on technology, adapting their tech to their data findings. Drawback is it's Canadian-only focus. That said, he prefers larger banks operating in U.S. like TD and Royal.

Likes underdogs, including this one. But can it do better than the giant banks? Something to differientiate it? No. Buy National Bank (NA-T) instead.

Had some trouble with mortgage fraud and that affected the price of the stock. Diversified revenue stream compared to Home Capital. The do a lot of administration. Cheap compared to other Canadian banks but probably will stay cheap. He likes the banking sector for Canada, but he prefers other names for his clients. He wouldn’t recommend this one for his clients.

He is looking at this, because it has fallen off. Banking is increasingly being run by technology, and this bank doesn't really have the scale to build the same kind of platforms that the major banks do. They don't have the flexibility that everyone else does. Consumers are moving more and more to online, and long-term this is the biggest issue this bank is facing. Doesn't think they are an acquisition target, because they are the only unionized bank in Canada. They are dealing with a small market and are trying to get into niche businesses. It is a real struggle, so he would be very careful before stepping in. It appears cheap on the surface, but the question is what kind of an investment are they going to have to make in their business to be sustainable for the long haul.

He doesn't have an overall positive view on Canadian financials, and would prefer US financials. This bank had an issue recently with a fairly large write down. When banks have issues like this, it’s unclear as to how long it is going to take to resolve.

The lending hiccup with mislabeled mortgages brought it down. Under $53 it is worth exploring. Hold on to it if you have it.

Trades at a deep discount to the larger banks. A regional player with almost all branches and footprint business in Québec. It’s still a regional bank, but has done a marvellous job of closing the gap in terms of its profitability, compared with the others. ROE has come up from about 6%-7% to 12%-13%, while the rest of the banks are in the 14%-17% range. The pullback in the stock was a result of some problems with mortgages. He would think the issue is behind them, and is not really material to their overall solvency or profitability. Strong balance sheet. The stock looks very interesting here.

Just did an equity issue, which may be the reason the stock is down today. They'll use the money to shore up the balance sheet. There were some underwriting issues a while ago. Feels their growth profile is inferior to the other banks. Would prefer being in the bigger banks, which have a broader geographic exposure with parts of their business in the US.