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TORONTO-DOMINION BANK $55 (Toronto symbol TD; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.9 billion; Market cap: $104.5 billion; Price-to-sales ratio: 3.3; Dividend yield: 4.0%; TSINetwork Rating: Above Average; www.td.com) earned $2.4 billion, or $1.18 a share, in its fiscal 2016 first quarter, which ended January 31, 2016. That’s up 5.8% from $2.1 billion, or $1.12, a year earlier. Earnings for its Canadian banks (62% of the total) rose 4.4%, thanks to strong loan demand and gains from the wealthmanagement and insurance businesses. Earnings from U.S. banking (31%) jumped 20.2%. That’s largely because the low Canadian dollar enhanced its profits. However, earnings from wholesale banking (7%) fell 16.1%. Lower stock trading volumes offset higher advisory fees on mergers and acquisitions. Revenue rose 13.1%, to $8.6 billion from $7.6 billion. However, TD set aside $642 million to cover potential future loan losses, up 77.3% from $362 million. That’s mainly because it recently acquired the U.S. credit card portfolio of department store Nordstrom’s (New York symbol JWN). As well, low oil prices could hurt the ability of energy producers to repay their loans. These borrowers represent less than 1% of TD’s overall loan portfolio....
IGM FINANCIAL INC. $36 (Toronto symbol IGM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 243.6 million; Market cap: $8.8 billion; Price-to-sales ratio: 2.9; Dividend yield: 6.3%; TSINetwork Rating: Above Average; www. igmfinancial.com) is Canada’s largest independent mutual fund provider. Power Financial owns 60.1% of IGM. The company has two main divisions. Investors Group offers mutual funds and other services, such as portfolio management, through 5,300 affiliated advisors. This business forms close relationships with clients, which helps it retain them. In 2015, its redemption rate for long-term funds was 8.7%, well below the industry average of 15.4%. The other division, Mackenzie Financial, sells funds through independent brokers....
HOME CAPITAL GROUP INC. $36 (Toronto symbol HCG; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 70.0 million; Market cap; $2.5 billion; Price-to-sales ratio: 4.2; Dividend yield: 2.7%; TSINetwork Rating: Average; www.homecapital.com) is a mortgage lender that serves borrowers who fail to meet the stricter standards of larger, traditional lenders, such as banks. Home Capital offers most of its loans through 4,000 independent mortgage brokers. In July 2015, it cut ties with 45 of them after it uncovered inaccurate information on loan applications. Specifically, these brokers falsified borrowers’ annual incomes but not their credit scores and property values. So far, Home Capital has reviewed 40% of these loans. Based on the results, it could renew 90% of these mortgages. The company expects to complete these reviews by the end of 2016....
EMERA INC. $47 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 145.3 million; Market cap: $6.8 billion; Price-to-sales ratio: 2.5; Dividend yield: 4.0%; TSINetwork Rating: Average; www.emera.com) has reached a deal to increase its ownership of Emera (Caribbean) Inc. From 95.6% to 100.0%. This publicly traded subsidiary holds Emera’s interests in power utilities in Barbados, Dominica and St. Lucia. Emera will cut administrative costs by taking full control. The company will pay roughly $16.5 million in cash and Emera stock for the additional stake. To put that in context, Emera earned $330.0 million, or $2.26 a share, in 2015....