Toronto-Dominion Bank (TD.TO)

Has a great franchise and it is not expensive, trading at about 11.5-12 times earnings. One of the few banks in Canada that has actually developed a franchise in the US. Have also done some very good acquisitions. Dividend yield of 4.01%.

US dollar revenues translate back to Canada quite favourably. Longer term they are a retail based franchise. They are the most conservative of the Canadian banks. Things are about as bad as they can get for the banks.

It is a good entry point to start initiating a position. It has not done well because of concerns on energy. She does not think the Canadian economy is going into recession. You don’t have to wait until they report. She expects 3-6% earnings growth. She likes the US exposure.

Canadian Banks have been under pressure with some US companies Shorting them. This one has a big US content. It hasn’t done much for a while and he is expecting better results in the upcoming quarters. Good dividend increaser. Dividend yield of 3.87%.

Manulife (MFC-T) or Toronto Dominion (TD-T)? Higher interest rates will effectively help the banks. This one is a retail bank with more locations in the US than in Canada. Both are good names. He prefers the banking side.

There are more branches in the US than there are in Canada. This bank is well-managed and has a good balance sheet. 4% dividend yield. He has been buying for new clients this week. (See Top Picks.)

Seasonally this does well from around the beginning of October right through until the end of the year. Currently the stock is in a downward trend and underperforming the TSE composite and trading below its 20 day moving average. Just recently broke its short term support level. Wait until mid-October which will give you an opportunity for a seasonal trade.

Best in class. He owned two stocks since day one and this is one of them. 10 times earnings. Close to half of their assets are in the US. He thinks the volatility is leaving the sector.

It is very rare that you see the multiple of this bank less than a couple of the other banks in the sector, and that is the situation we are looking at now. The multiple is down to about 10.8X next year’s earnings. The yield is still lower than some of the other banks, but he likes them because of their US exposure. The 2 banks with the lowest PE’s are the 2 that do not have as much US exposure. This is a great entry point. Yield of about 3.8%.

This is an important anchor within a portfolio. You should be aware that more than 50% of their revenues is coming from the US. Pays a good dividend of 3.9%.

He was a little disappointed in their last earnings. It was because of closing some branches in the US. He expects better results out of the US. He thinks they are second only to RY-T over the last year. The shorts are going to get it wrong again.

Canadian Banks are very steady type of names. This is trading at 11X forward PE, which is historically the average type of PE for most bank stocks. You will probably see a 9% growth rate in terms of earnings. 3.5% dividend yield will probably grow at around 6%-7% per year.

(A Top Pick June 11/14. Up 3.03%.) Returns have been flat as expectations for economic growth in Canada subside because of the collapse in oil prices. He mulled over using this as a Top Pick again. Not particularly expensive.

He likes it in order to get access to the US. He looks for better growth in the street and given their deposit base, a quarter point interest rate increase and the net returns from deposits would create $0.60 per share.

Wouldn’t be worried about the banks. There are 2 views. Are you going to hold this for the next 3-5 years or more? If so, just hold onto them. Valuations aren’t wildly expensive; they are just OK and reflect the reality of what is happening to the banks. Outlook doesn’t look great for the next 12 months, so find some of the names that you can offset some of that risk in another sector.