Bank of Nova Scotia $51 - Toronto symbol BNS

Bank of Nova Scotia $51 (Toronto symbol BNS Conservative Growth Portfolio, Finance sector; Shares outstanding: 987.0 million; Market cap: $50.3 billion; SI Rating: Above average) is the third-largest bank Canadian bank, with $452.6 billion in assets. The bank has few holdings in the U.S. It prefers to focus on developing regions where it can quickly expand its market share. International operations now supply 30% of its earnings. For example, it recently increased its stake in Scotiabank Peru, that country’s third-largest bank, from 78% to 98%. The $230 million price is equal to 20% of the $980 million or $0.97 a share that Bank of Nova Scotia earned in the three months ended April 30, 2008. Bank of Nova Scotia is also expanding its Canadian operations. It recently agreed to pay $442 million U.S. for the Canadian operations of E*Trade, a leading online discount broker. The purchase will increase Bank of Nova Scotia’s share of Canada’s fast-growing online investing market, from 6% to 10%, based on the number of accounts. The bank should earn $4.04 a share in fiscal 2008, which implies a p/e of 12.6. The $1.96 dividend yields 3.8%. Bank of Nova Scotia is a buy.