TD - TD Bank: Valuation Gets More Interesting

2024-05-06 12:15:54 ET

Summary

• We review our suggested trade for TD Bank from our last article.
• The bank has been crushed since AML penalty estimates have risen.
• We look at the Q1-2024 results and tell you why this is now making sense for our portfolio, but perhaps not for yours.

In our last coverage of The Toronto-Dominion Bank ( TD ), we recognized that the franchise had made a lot of green for investors over the long run. The brand and the strong return on equity metrics, alongside a really long uninterrupted dividend streak, were positives. We were not comfortable with a buy rating though, as we felt the valuation was middling for the risks presented in the Canadian economy. Ultimately, we went with a "hold" and suggested investors look at the covered calls for smoother returns....

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