Toronto-Dominion Bank (TD.TO)

Bank of Nova Scotia (BNS-T) or TD (TD-T) and FinTech competition? Everybody is competing with FinTech these days and all the banks have issues. A lot of FinTech’s advantage is that they are not really regulated at this stage and can do a lot of things regular banks cannot do. Banks are taking measures including cutting costs, introducing new technology, etc. It is still early stage. The choice between these 2 banks is that this one has better exposure and BNS has better International exposure. At this point he thinks TD is winning out with a steadier economy.

One of the best in Canadian retail banking. Their numbers were good. He likes that they have a great presence in the US. They will continue to increase their dividends and earnings. Dividend yield of 3.81%.

They have become part Canadian and part US. They made some phenomenal acquisitions in the US. He does not like the entry price here.

Has very nice US exposure, and she is more positive on the US economy versus Canadian. All banks have given disclosure on their energy book. Provisions are going up a bit, and thinks they are manageable. Expects to see a slow recovery in the Canadian economy. For a new client, she would start building a position in this.

It looks interesting but it is at the higher end of the valuation range of the Canadian banks. He worries far less about the banking system and the housing market in Canada. They have great diversity. This is not going to burn you. You have the yield until growth starts happening again.

It is trading in an elevated range. This is a bullish pattern. Within this range investors are generally accepting the level. In the long, long run it looks fine. It has to break above $58 before it can go higher.

Banks will be higher by year end. The one looming thing is the impact over the years of FinTech. The banks are spending a lot of money trying to match what is coming down the pike in terms of high-tech, and he thinks they’ll succeed. Expects they will go 5% higher, including dividends, by the end of the year.

(A Top Pick April 27/15. Up 2.47%.) Banks are great buys and this is his favourite, along with Royal (RY-T) and Bank of Montréal (BMO-T). He likes their US exposure and the continued likely acquisition programs in the US. Looking out 2-3 years, banks are a great Buy.

Sell to get into a stock that has more growth? He likes this bank. A good, long term holding. You get 50% US, which is a little better growth. They are good operators. Dividend yield of 4% and it is going to grow. If this has become more than 7%-8% of your portfolio, he would consider selling it for diversification. Choices that are similar are all a little more expensive than the banks. (See Top Picks.)

(A Top Pick April 10/15. Up 4.85%.) He is hoping to see a dividend increase. If you want exposure to the US banking system, this is probably the better way to do it. They have a good foothold. With the US economy growing faster than Canada, this is a good place to be.

This has traditionally been his #3 bank, and he is thinking of upping his exposure. They have done a very good job in the US and captured a significant part of the retail market there, as well as in the brokerage business. Trading below its historic P/E ratio and Price to Book ratio. Dividend yield of 4%.

Thinks there is still another wave to come in energy. While this bank doesn’t have as big an exposure as some others, he doesn’t think it has all been factored in just yet. He has been somewhat light on the banks. The one thing this has is a significant exposure to the US.

From August through to the end of the year, banks do quite well. The 2^nd period of seasonal strength generally occurs from February through to April, and then the stock tends to level off. Charts show this has rolled over in the last couple of days because of selling pressures. Support level would be at $52.50. If you are still holding banks, look for something that offers a covered call write strategy.

Wait until after earnings in case low energy prices have trickled down? He likes the banks. Great dividends of around 4% and great opportunities to increase dividends by 5%-7%. Thinks concerns on bad loans due to oil prices is getting a little overdone. They have been setting money aside to deal with bad loans.

He cares most about business risk to the banking sector overall. See his educational segment today. The banks had a great run from January, but he does not like owning banks generally. He does not like TD-T here and is underweight financials as a source of dividends in his dividend fund. He did hold it earlier in the year for a while.