Toronto-Dominion Bank (TD.TO)

There is supposed to be a stock split. Do you Buy before or after? It really doesn’t matter. Historically share splits haven’t really proved to increase the value of a stock. He likes this bank fundamentally. Today’s pullback is probably a pretty good entry point. He expects some of the Canadian banks to post decent numbers. His bias in the last 12-24 months has been to own US banks which he felt would deliver higher personal and commercial loan growths where candidates will have decelerating loan growths. This would be one of his more favourite Canadian banks. (See Top Picks.)

Have their big US operation where they have more branches. This bank has always been a good performer. Thinks the stock needs to be split which would give it a little more bounce. US side has done extremely well and they continue to emphasize the service side of the industry. Very safe stock.

From a long-term perspective, he would not hesitate to buy this bank. Trading at full valuation, but by no means is it ridiculously priced. Have done an outstanding job of developing their profitability in the US market. Increasing their dividends. A very, very well run bank.

In his process this bank ranks in the middle of the pack, so he wouldn’t own right now. Due for a stock split. Very interesting psychology that revolves around a split. Tend to perform very well before and immediately after the split. If you are looking at it from a short-term perspective, you could probably Buy it here.

This and the Royal Bank (RY-T) are the most highly valued banks on the Canadian market but are actually doing better than the other banks in terms of performance. Their foray into the US in the next 3-5 years will look very promising to anyone looking at this bank. If you would like to buy on dips, this is a good opportunity. US financials are way cheaper and have a much larger upside and profit potential.

An excellent bank. Has more US exposure than any of the other Canadian banks. As we think the US economy is going to do better, this is a pretty good thing. It doesn’t matter whether you buy it pre-split or post-split.

US exposure is almost half of the bank. They are good at managing it. Banks are now branded as TD. Americans don’t know what TD stands for. Expects above average earnings growth and dividend increases.

Reset Bonds resetting in 2016/17. They are going to be called. This kind of paper will no longer count under Basel III so they have no reason to continue to hold it.

Canadian banks could experience some tougher sledding, going forward next year. Mortgage origination is probably going to be down. Rising rates are positive on one hand, but dividend stocks are kind of negative. Don’t bother getting in now as there is not a ton of upside. Earnings are not going to accelerate for the next couple of years. Better places to be.

TD is probably the best managed but does not make it the best bargain. ROE is lower. TD is moving with the momentum of the group. Investors have probably been left disappointed and that is why we have seen a check back in this bank. Let it go for a bit and see if we can get some better prices.

(Top Pick Dec 17/12, Up 27.91%) 2 for 1 split in January. We are in a super charged growth market and these will not do as well as they have.

Best of breed. Improving growth rates in North America will benefit them. CEO made the point there will be potential acquisitions in the credit card area and would increase customers and would give the ability to cross sell. If rates start to go up, net interest margins will go up and will benefit them.

Made some great acquisitions. A very strong franchise. Not expensive at 1.9X book. 3.45% dividend yield. Trading at 11X earnings.

Good for a 10-15 year hold? He would stage into this by buying a 3^rd now, a 3^rd in January and a 3^rd in February. Generally you get a rally at year end, and then things pull back a little. You might be able to get it in the mid-$90s instead of at its all-time high. Feels they have great upside on a US recovery and a very solid position in Canada.

(A Top Pick Jan 30/13. Up 91.6%.) This was to Buy Jan 2014 $90 Calls at $1.60. (Because of the split coming in January, this will be a $45 Call.) Thinks there is more to come on this and you still have a year.