Toronto-Dominion Bank (TD.TO)

All of the interest sensitives have been under pressure the last couple of months with rates rising.

He favours TD. Tightly regulated oligopoly, and a levered play on the growth of the Canadian, and increasingly US, economy. Surplus of excess capital. 10x earnings. Dominant personal and commercial banking franchise. Good-sized banking presence in the US. Shares are at a discount to average. Close to 5% yield, growing at 8% compound over 10 years.

Valuation and yield of SLF are similar to TD. But TD's competitive position in its industry is more advantageous than SLF.

Compared to CM, TD is more of a scale player with a stronger franchise on both sides of the border on its core banking business.

Pleased that the First Horizon deal collapsed. TD pays a great return on invested capital, about 16%. Great staying power in Canada. The US is investigating it for their money-laundering compliance, but it's not a mortal threat and they'll likely be fined. Likes their big retail platform in the US. It's his second-biggest Canadian bank holding.

It has a great U.S. franchise and may do another acquisition there. It trades at 10X earnings and pays a dividend of 5%.
Buy 12  Hold 5  Sell 1

The most retail-focused of the Canadian banks, and they do it very well. Very steady business, great credit controls. Solid dividend, good growth. Core holding.

Fears of recession are real, but won't be hurt too badly in mortgage market. Not expecting a big increase in non-performing loans. Loan books are in great shape, as regulations result in bigger risks shifting to non-bank lenders.

He bought it at the bottom earlier this year, and hopes it can return to $90. He remains positive. If you want only the dividend, you're fine as long as it stays in its range. Will sell around $90 and thinks it will happen. Not a long-term hold unless it stays above $90.

Still likes Canadian banks, even with the pullback. Positioned well defensively. Great dividends that aren't going anywhere, even as the stock price fluctuates. A preference for her in the space, based on valuation and potential upside. Over the long run, more consistent and less volatile. 

Inquires into money laundering not too big a concern.
Strong brand and robust assets.
Lots of capital on balance sheet.
Increased share buyback program this past quarter.
Owns shares in the company.
Dividend yield attractive & safe.
Current share price price is a good time to buy. 

Canadian banks are reasonably priced, but still headwinds on loan losses. He likes the one with the best balance sheet, TD. He also likes CM, with its outsized dividend yield and low valuation. BMO is OK.

For the heavy lifting in your portfolio, he'd look instead at insurance companies with similar yields and more growth over the next 1-2 years.

It has the leading market share in Canada along with Royal Bank. It wants to target the banking needs of a growing number of new immigrants. Credit cards are also an area of growth. The Horizon deal didn't go through so it has excess capital for buybacks, etc. We could see some more M&A.       Buy 13  Hold 4  Sell 1  

Well capitalized. Cheap at these levels, you'll do well. 10x earnings, 1.4x book, not expensive. Great retail franchise, reasonable investment banking. US side will improve on ROE over time. Great dividend yield of 4.46%.

Able to play offense in a tough environment. Valuation of 10x earnings, discount to peers. Most excess capital of any Canadian bank. A conservative commercial real estate lender, so exposure isn't outsized. Yield is 4.49%.

Very well run, high quality. Strong brand, good business model. Flush with capital, so probably hunting for a good asset. Cheap. Impressive dividend yield. Buy it here.

He's not sure that the crisis is over. Excess savings during Covid are waning as inflation bites. Canadian banks are valued reasonably, so are good to buy now as a long-term hold. But inflation could bite and trigger defaults and credit spreads widening on corporate bonds. He's waiting. You can buy a partial here and wait, because such shares could go lower. TD shares have moved from $78 to $83 recently. He bought, but is sitting tight.

Likes Canadian banks as a group, well capitalized. She favours TD and RY, with exposure to US growth. Attractive yields. She doesn't think we're going into a deep recession in Canada or the US.