Canada’s other banks also look strong

Article Excerpt

TD (see page 31) and Bank of Nova Scotia are our top picks among Canada’s big five banks right now, due to their wide international exposure. But we still like the prospects of Royal Bank, Bank of Montreal and CIBC. All three are well positioned to weather any downturn in the Canadian economy. They also trade at attractive multiples to earnings and continue to raise their dividends. ROYAL BANK OF CANADA $76 (Toronto symbol RY; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.4 billion; Market cap: $106.4 billion; Price-to-sales ratio: 3.2; Dividend yield: 4.1%; TSINetwork Rating: Above Average; www.rbc.com) recently said it would buy City National (New York symbol CYN). This Los Angeles-based bank focuses on wealthy individuals and lending to businesses in the entertainment, technology and health care industries. Royal plans to merge it with its U.S. wealth management operations. Royal will pay $5.4 billion U.S. (50% in cash and 50% in shares). Assuming City National shareholders…

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