RE:RE:UpgradeMore details. GLTA
Joo Ho Kim, an analyst at Credit Suisse, raised his target price on Toronto-Dominion Bank(TD-T) to $88 from $85 previously and upgraded his recommendation on the stock to “outperform” from “neutral” – even as an expected further deterioration in net interest margins and credit offer challenges to the Canadian banking sector’s growth outlook.
Part of the upgrade relates to the fact that TD shares have underperformed other Canadian banks this year, particularly as investors were faced with uncertainty over TD’s deal to acquire First Horizon Corp. (FHN-N) – a deal that was recently terminate. However, the bank has delivered strong results before provisions for credit losses are factored in.
“Post the termination, we believe the bank’s excess capital position skews the risk-reward profile for the bank (despite some timing and directional uncertainty),” he said in a note.
With the upgrade, TD is now the analyst’s top pick among Canadian banks, followed by National Bank of Canada, Bank of Montreal and Royal Bank of Canada.