TSX:EQB - Post Discussion
Post by
retiredcf on Nov 29, 2023 7:31am
RBC
Their upside scenario target is $113.00. GLTA
Outperform
TSX: EQB; CAD 74.24
Price Target CAD 100.00
Q4/23 preview and adjusting forecasts for change in fiscal year end
Our View: Q4/23 results are likely to be a bit noisy with EQB’s change in fiscal year-end to October (from December) resulting in Q4/23 being the 4-months ended October 31, 2023. We think Q4/23 results are likely to provide further evidence of EQB’s solid execution on its growth strategy, but the recent start of slowing housing market activity may slightly temper EPS growth with the slow down likely to be more evident in upcoming quarters. In addition, we expect a slight increase sequentially on PCLs, driven by weaker economic and housing market conditions as opposed to deteriorating loan performance. EQB is also likely to provide 2024 guidance, which would include the recently announced acquisition of ACM Advisors. Within our small cap coverage, EQB remains our best idea. Maintaining our Outperform rating and $100 target.
Key points:
EQB reports Q4/23 results on Thursday December 7, 2023, after market close with the conference call scheduled for the next morning (December 8, 2023) at 8am ET; dial-in: (416) 764-8609 or webcast link on EQB website.
Our Q4/23 (4-months) forecasts reflect: (1) normalized EPS of $3.64 (excl. derivative gains, losses on investments, and acquisition-related costs), slightly below consensus of $3.67 (range of $3.52 to $3.74); (2) originations of $5.81B ($2.86B in Personal and $2.95B in Commercial); and (3) provisions for credit losses of $18MM.
We think investors' focus for Q4/23 results include: (1) 2024 guidance, including any additional details regarding the financial impact of the recently announced acquisition of ACM Advisors; (2) latest insights on loan performance and the housing/mortgage market; and (3) NIM yield outlook.
Maintaining our Outperform rating and $100 target.
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