BMO Capital Reviews Canadian Banks' Q2 Earnings""Overall, a good quarter reflecting of intact fundamentals, but we believe Canadian bank investors remain focused on macroeconomic factors, such as inflation and interest rates," BMO says, pointing out that higher rates can be a double-edged sword with some near-term benefits (good for lending margins), but also slower economic growth (which can weigh on credit quality). Historically, a period of bank stock underperformance in a rising rate cycle has been followed by outperformance (relative to the composite) in the following six and 12 months. "We are not rates experts, but if we are nearing the peak of the 10-yr Canada rates for this cycle, then bank stocks are likely to outperform. While we wait, we collect a 4% dividend yield (highest of 4.8% at BNS)."
Outperform-rated names remain CM, BNS, and NA. Between the two Market Perform rated banks BMO prefers RY to TD."
https://www.tradingview.com/news/mtnewswires.com:20220531:A2675209:0-bmo-capital-reviews-canadian-banks-q2-earnings/