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Toronto-Dominion Bank T.TD

Alternate Symbol(s):  T.TD.P.I | T.TD.P.J | TNTTF | T.TD.P.M | TD | T.TD.P.A | TDBCP | T.TD.P.B | TDBKF | T.TD.P.C | T.TD.P.D | T.TD.P.E

The Toronto-Dominion Bank (the Bank) operates as a bank in North America. The Bank's segments include Canadian Personal and Commercial Banking, U.S. Retail, Wealth Management and Insurance, and Wholesale Banking. Its Canadian Personal and Commercial Banking segment offers a full range of financial products and services to approximately 15 million customers in the Bank’s personal and commercial banking businesses in Canada. Its U.S. Retail segment offers a range of financial products and services under the brand TD Bank, America’s Most Convenient Bank. U.S. Retail Segment also TD Auto Finance U.S., TD Wealth (U.S.) business. Wholesale Banking segment operates under the brand name TD Securities, which offers a range of capital markets and corporate and investment banking services to corporate, government, and institutional clients. Its Wealth Management and Insurance segment provides wealth solutions and insurance protection to approximately six million customers in Canada.


TSX:TD - Post by User

Post by retiredcfon Jan 12, 2024 11:49am
236 Views
Post# 35823737

TD

TD

Q4/23 Preview

Continued Weakness in Commodity Prices

Pushes U.S. Recovery Timeline Further Out

 

TD Investment Conclusion

Revisions to Our Industry Outlook: Based on feedback from our recent London

Energy & Power Conference, Canadian drilling and completions capital programs are

expected to remain resilient in the face of continued weakness in both crude oil and

natural-gas commodity prices. In our view, this is largely a function of expectations

of an improvement in market access for Canadian E&Ps in the near term. That said,

we have observed a further negative shift in U.S. sentiment since we published our

most recent Energy Services industry update on December 20, 2023 (full report).

As a result, our 2024 and 2025 U.S. rig count forecasts decrease to 645 rigs and

685 rigs, respectively. In the fall, there was a broadly held view that activity would

recover in the new year, but with the recovery timeline pushed out, we believe that

this will also have negative consequences for pricing. As a result, we are reducing

our estimates for several companies in our coverage universe with meaningful U.S.

exposure (details on page 3).
 

Q4/23 Preview: With a few notable exceptions, we expect that Q4/23 will largely play

out with expectations articulated with Q3/23 disclosures. That said, we are reducing

our estimates for Enerflex (EFX-T, BUY, $10.00 TP) and Pason (PSI-T, BUY, $21.00

TP) to account for the continued devaluation of the Argentinean peso. On the other

hand, we are increasing our estimates for CES (CEU-T, BUY, $5.00 TP) to reflect

increasing market-share capture as U.S. fundamentals deteriorate and continued

strength in margin performance.
 

Sector Stance: MARKET WEIGHT
 

Despite the meaningful pullback in equity performance across the coverage

universe, we are not yet ready to take a more positive stance on the sector.

That said, our coverage universe remains well-positioned to deliver strong free-

cash-flow generation in 2024 that will be utilized to deleverage and/or pursue

more meaningful shareholder-return initiatives. Within our coverage universe, we

highlight Precision's (PD-T, BUY, $125.00 TP) exceptional value on a free-cash-

flow yield basis, as well as a relative outperformance thesis for both CES

(CEU-T, BUY, $5.00 TP) and Pason (PSI-T, BUY, $21.00 TP) based on company-

specific factors.

 
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