TD stands out in a strong field

Article Excerpt

Canada’s banks continue to rebound strongly from last year’s COVID-19 lows; rising vaccination rates are letting more businesses re-open, which further fuels stock gains. Consumers also continue to repay their loans on time. We like all of the Big Five banks, but TD stands out thanks to its strong retail banking operations in Canada and the U.S. That makes it less reliant on volatile capital markets trading volumes. What’s more, TD is the best capitalized bank with a CET1 ratio of 14.2%. (CET1, or Common Equity Tier 1, measures a bank’s ability to keep extending credit to individuals and businesses.) That puts it in a strong position to reward investors with higher dividends and share buybacks once banking regulators lift their pandemic-related restrictions. We expect regulators to make that move this year. TORONTO-DOMINION BANK $85 is a buy. The lender (Toronto symbol TD; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.8 billion; Market cap: $153.0 billion; Price-to-sales ratio: 3.8; Dividend…