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On today's TSX Breakouts report, there are 47 stocks on the positive breakouts list (stocks with positive price momentum), and just nine stocks are on the negative breakouts list (stocks with negative price momentum). The S&P/TSX composite index is less than 1 per cent away from closing at a record high.

Several bank stocks appear on the positive breakouts list. Featured today is the bank that kicks off the earnings season, reporting its fourth-quarter financial results before the market opens on Nov. 28. The company highlighted below is The Bank of Nova Scotia (BNS-T).

A brief outline is provided below that may serve as a springboard for further fundamental research.

The company

Bank of Nova Scotia is a Canadian bank with international operations. The bank provides financial services across North America, Latin America, the Caribbean and Central America, as well as in Asia.

On Nov. 28, the Street is anticipating the company will report fourth-quarter earnings per share of $1.66.

Last quarter, before the market opened on Aug. 29, the company reported better-than-expected third-quarter fiscal 2017 financial results. However, the share price was relatively unchanged that day, rising 13 cents to close at $77.33.The company reported adjusted earnings per share of $1.68, exceeding the consensus estimate of $1.64. The common equity tier 1 capital ratio was 11.3 per cent as at July 31. Return on equity was 14.3 per cent, unchanged sequentially.

On the earnings call, Chief Executive Officer Brian Porter stated, "We delivered strong results in our core personal and commercial banking businesses in Canada and internationally. We are driving strong levels of return on equity and improving the bank's efficiency. And lastly, our restructuring programs is realizing savings ahead of our target in 2017. These benefits will allow us to continue investing for the future."

He added, "Looking forward, we will continue to focus on improving customer experience by enhancing our digital capabilities, optimizing our business mix and becoming more efficient. Internationally, we remain committed to our key markets of Mexico, Peru, Colombia and Chile, where we continue to see significant opportunities for growth. We expect Global Banking and Markets to continue to perform well and drive good results. As we continue to improve operations, earnings will reflect further consistency and profitability. Overall, we have a clear sense of direction, and we're pleased with the progress we're making on executing our strategic agenda. We are confident that this progress will benefit our shareholders, customers and employees. We provide a more detailed update on our business outlook and strategy in Q1 (first quarter) 2018 as we will be hosting an all-bank Investor Day here in Toronto on February 1, 2018."

The company's shares are dual-listed, trading on the Toronto Stock Exchange and the New York Stock Exchange under the same ticker, BNS.

Returning capital to investors

The company pays shareholders a quarterly dividend of 79 cents per share or $3.16 on a yearly basis. This equates to an annualized dividend yield of 3.7 per cent.

The company has a history of announcing dividend increases every other quarter. Given management announced a dividend increase along with its third-quarter financial results, the next dividend hike will likely be announced in early 2018.

Last quarter, the payout ratio was 47 per cent, within management's target range of between 40 per cent and 50 per cent.

Last quarter, the company repurchased 4-million shares at an average price per share of approximately $74.83. For the first nine months of fiscal 2017, the company has bought back 14-million shares as part of its share buyback program at an average price per share of $72.09.

Analysts' recommendations

There are 12 analysts with buy recommendations and three analysts have hold recommendations. There are no sell recommendations.

Revised recommendations

Earlier this month, three analysts revised their target prices.

Mario Mendonca, the analyst from TD Securities, took his target price up by $1 to $91. Doug Young from Desjardins Securities lifted his target price by $2 to $89. Meny Grauman, the analyst from Cormark Securities, increased his target price to $91 from $84.

Financial forecasts

The consensus earnings per share estimates are $6.54 in fiscal 2017 rising 7 per cent to $6.98 in fiscal 2018. Next week, after the company reports its year-end results, analysts will formally introduce their fiscal 2019 earnings estimates, if they have not already done so.

Earnings expectations have increased modestly. For instance, three months ago, the consensus earnings per share estimates were $6.48 for fiscal 2017 and $6.93 for fiscal 2018.

Valuation

The stock is trading at a price-to-earnings multiple of 12.1 times the fiscal 2018 consensus estimate.

The consensus 12-month target price is $88.07, implying the stock is nearly fully valued with just 4 per cent upside potential over the next year (including the dividend this equates to a potential total return of nearly 8 per cent). Individual target prices range from a low of $84 (from the analyst at Credit Suisse) to a high of $92 (from the analyst at Canaccord Genuity).

Insider transaction history

Recently, three management executives were sellers in the market.

On Oct. 10, Andrew Branion, Executive Vice-President and Group Treasurer, sold 516 shares at an average price per share around $80.54, leaving just 158 shares in his account.

On Oct. 4, Kyle McNamara, Executive Vice-President – Global Retail Banking Technology, exercised his options and sold the corresponding number of shares (3,036) at an average price per share of $80.5349, leaving 7,068 shares in his portfolio.

On Sept. 12, Deborah Alexander, Executive Vice-President and General Counsel, unloaded 7,114 shares at an average price per share of $76.7598, reducing her portfolio's holdings to 8,157 shares. Ms. Alexander will be retiring at the end of the year and Ian Arellano will be assuming the position on January 2, 2018.

Chart watch

Year-to-date, the share price is up 13 per cent and much of the positive price momentum has occurred in recent weeks. Over the past two months, the share price has rallied nearly 10 per cent.

In terms of key technical resistance and support levels, the stock has initial overhead resistance around $85. After that, the share price could rally to the $95 level until it faces significant overhead resistance. Looking at the downside, the stock has technical support around $80, close to the 50-day moving average (at $80.88) and its 200-day moving average (at $78.61).

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The Breakouts file is a technical analysis screen intended to identify companies that are technically breaking out. In addition, this report highlights a company's dividend policy, analysts' recommendations, financial forecasts, and provides a brief technical analysis for a security to provide readers with more information.

If a stock appears on the positive breakouts list, this indicates positive price momentum, and that a company may be worthwhile for investors to look at the fundamentals in order to determine if the recent price strength is warranted and will continue. If a security appears on the negative breakouts list, this indicates negative price momentum, and may be indicative of either deteriorating fundamentals or perhaps indicates a buying opportunity.

Securities screened are from the S&P/TSX composite index, the S&P/TSX Small Cap index, as well as Canadian small cap stocks outside of these indexes that have a minimum market capitalization of $200-million.

A technical analysis screen does not replace fundamental analysis, but can help identify companies worth having a closer look at.

Positive BreakoutsNov. 17 close
AIM-TAimia Inc $3.47
AQN-TAlgonquin Power & Utilities Corp $14.17
ADW.A-TAndrew Peller Ltd $12.92
BNS-TBank of Nova Scotia $84.59
BCE-TBCE Inc $61.72
GBT-TBMTC Group Inc $15.03
BPF.UN-TBoston Pizza Royalties Income Fund $22.31
DOO-TBRP Inc $45.29
CFW-TCalfrac Well Services Ltd $5.96
CGY-TCalian Group Ltd. $34.73
GOOS-TCanada Goose Holdings Inc. $33.67
CAR.UN-TCanadian Apartment Properties REIT $37.20
CFP-TCanfor Corp $26.54
CHR-TChorus Aviation Inc $9.78
CM-TCIBC $115.10
CVG-TClairvest Group Inc. $38.50
CGO-TCogeco Inc $91.44
CUF.UN-TCominar Real Estate Investment Trust $14.20
BCB-TCott Corp $21.65
CRT.UN-TCT Real Estate Investment Trust $14.79
DML-TDenison Mines Corp $0.70
DIV-TDiversified Royalty Corp $3.56
DRG.UN-TDream Global REIT $11.65
DRM-TDREAM Unlimited Corp $8.03
ERO-TEro Copper Corp. $6.54
ET-TEvertz Technologies Ltd $19.58
EIF-TExchange Income Corp $35.64
FC-TFirm Capital Mortgage Investment Corp $12.81
HCG-THome Capital Group Inc $15.67
IBG-TIBI Group Inc. $7.96
IRG-TImvescor Restaurant Group Inc. $4.20
JWEL-TJamieson Wellness Inc. $21.70
KMP.UN-TKillam Apartment REIT $14.12
MRE-TMartinrea International Inc $14.80
MKP-TMCAN Mortgage Corp $17.33
NVU.UN-TNorthview Apartment REIT $25.24
NWH.UN-TNorthWest Healthcare Properties REIT $11.59
RFP-TResolute Forest Products Inc. $11.68
RCI.B-TRogers Communications Inc $68.49
SJ-TStella-Jones Inc $50.81
SVI-TStorageVault Canada Inc. $2.52
SOX-TStuart Olson Inc $6.05
TD-TToronto-Dominion Bank $73.55
TC-TTucows Inc. $77.37
U-TUranium Participation Corp. $4.23
VBV-TVBI Vaccines Inc $5.75
WFT-TWest Fraser Timber Co Ltd $82.71
Negative Breakouts
BNP-TBonavista Energy Corp $2.40
BPY.UN-TBrookfield Property Partners LP $27.95
CHW-TChesswood Group Ltd $11.47
GCG.A-TGuardian Capital Group Ltd $23.90
KML-TKinder Morgan $15.74
MRD-TMelcor Developments Ltd $14.80
NFI-TNew Flyer Industries Inc $49.19
PEY-TPeyto Exploration & Development Corp $16.27
TH-TTheratechnologies Inc $6.43

Source: Bloomberg