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The Toronto-Dominion Bank TD

Rating as of

Morningstar’s Analysis

Valuation
Currency in CAD
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Lower Revenue and Balance Sheet Growth for Toronto-Dominion in Fiscal Third Quarter

Eric Compton, CFA Senior Equity Analyst

Analyst Note

| Eric Compton, CFA |

Wide-moat-rated Toronto-Dominion reported adjusted EPS of CAD 1.96 for the fiscal third quarter, solid year-over-year growth compared with CAD 1.25 in the same period a year ago. Provisioning continues to be a major driver of improved year-over-year earnings, coming in at a net benefit of CAD 37 million this quarter, materially lower than the CAD 2.2 billion million charge the bank took in the third quarter of 2020. This aligns with our view that the Canadian banks will be fine from a credit perspective and that better results should be the norm going forward. We still expect the return of fee growth and much lower provisions to drive solid earnings growth for the rest of the year. We believe the bank still has room to release more reserves. We think commercial and card growth could start to improve in 2022, while less of a boost from lower provisioning should make for tougher comparisons.

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Company Profile

Business Description

Toronto-Dominion is one of Canada's two largest banks and operates three business segments: Canadian retail banking, U.S. retail banking, and wholesale banking. The bank’s U.S. operations span from Maine to Florida, with a strong presence in the Northeast. It also has a 42% ownership stake in TD Ameritrade, a discount brokerage.

Contact
C/o General Counsel’s Office, P.O. Box 1, Toronto-Dominion Centre
Toronto, ON, M5K 1A2, Canada
T +1 416 308-6963
Sector Financial Services
Industry Banks - Diversified
Most Recent Earnings Jul 31, 2021
Fiscal Year End Oct 31, 2021
Stock Type
Employees 89,598