TSE:RY

Royal Bank (RY.TO)

283.09
-1.98 (0.69%)
as of Sep 29, 2026, 4:56:28 pm Market Open.
1480 watching
0
TOP PICK
RBC CAPITAL TRUST BONDS Dec 31’13– doesn’t think there is a maturity risk. They are best of breed. It’s good value here. (Similar for all the banks.) Close to 7%, semi-annual coupon.
DON'T BUY
Not his favorite. They have US customers in the US southeast where they will have some losses but it’s a small enough piece of their business that it is not going to overwhelm the bank. It will cut into growth but no more than that.
BUY
A tremendous amount of money sitting on the sidelines and it has to find a home because of poor returns. Good yield.
WATCH
350 companies in the US financial sector have plummeting profitability. These concerns are going to keep on revisiting us. Would love to step in and buy this one at the right time and is waiting for the opportunity. A little uptick in profitability and he will be there.
DON'T BUY
Banks did a really good job this quarter relative to expectations. This would be one of the stellar ones. The issue he has with the banks right now is lack of earnings growth. Thinks we are through the worst of the asset backed write-offs. Now we are into the pure credit cycle and there is a little bit more deterioration on the credit side.
COMMENT
With a 5-year time horizon, you are fine with any of the banks. This one has moer issues with the US with its bigger exposure. Caught in the same issues as all global financials. Credit crunch is impacting balance sheets. Probably more write-downs to come. Earnings growth is going to be pretty tough.
DON'T BUY
Would prefer Toronto Dominion (TD-T) and Bank of Nova Scotia (BNS-T). Owns this but is underweight. Worried that they could surprise on the downside in the quarter.
DON'T BUY
About 25% of its earnings come from the US now. Banks with US exposure are not valued as well as those without. There is still a black hole in the US as to how much bad paper is still out there. A great bank, but its US exposure will continue to hurt them.
DON'T BUY
(Preferred Shares) Not have fan of preferred shares. Most of them are perpetual is meaning that once you buy them you are stuck with them. He sees higher interest rate potential down the road.
COMMENT
Well run bank. If the US financials turnaround, the Canadian banks will start to recover.
DON'T BUY
On Canadian banks this is the biggest and probably the strongest but unfortunately it has built up a big presence in the US, which has built up their risk factor.
COMMENT
Q: Sell this one for a tax loss and going into Bank of Nova Scotia (BNS-T)? A: From a tax point of view, he would have no disagreement with this. In 5, 10, 15 years both banks are going to look like great investments. On the other hand, you could add BNS to your existing portfolio.
WAIT
Would wait for lower prices. Could see the stock easily trading down at around $38 but the target he would really like to see is $31 and he thinks it will get there.
HOLD
Have some issues they have to deal with. Expansion in the US and limited growth in Canada. Valuation is getting somewhat more attractive. Wouldn't rush out and buy the banks yet.
HOLD
Vulnerable, but not as much as some of the others. Medium to longer term, have a great franchise and the US expansion will be positive. Possible US recession and credit contraction will be tough on the banks. Prefers Toronto Dominion (TD-T) and Bank of Nova Scotia (BNS-T).
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