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1. Company Snapshot

1.a. Company Description

The Toronto-Dominion Bank, together with its subsidiaries, provides various financial products and services in Canada, the United States, and internationally.It operates through three segments: Canadian Retail, U.S. Retail, and Wholesale Banking.The company offers personal deposits, such as chequing, savings, and investment products; financing, investment, cash management, international trade, and day-to-day banking services to businesses; and financing options to customers at point of sale for automotive and recreational vehicle purchases.


It also provides credit cards and payments; real estate secured lending, auto finance, and consumer lending services; point-of-sale payment solutions for large and small businesses; wealth and asset management products, and advice to retail and institutional clients through direct investing, advice-based, and asset management businesses; and property and casualty insurance, as well as life and health insurance products.The company also provides capital markets, and corporate and investment banking products and services, including underwriting and distribution of new debt and equity issues; advice on strategic acquisitions and divestitures; and trading, funding, and investment services to corporations, governments, and institutions.It offers its products and services under the TD Bank and America's Most Convenient Bank brand names.


The company operates through a network of 1,061 branches and 3,381 automated teller machines (ATMs) in Canada, and 1,148 stores and 2,701 ATMs in the United States, as well as offers telephone, digital, and mobile banking services.It has a strategic alliance with Canada Post Corporation.The Toronto-Dominion Bank was founded in 1855 and is headquartered in Toronto, Canada.

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1.b. Last Insights on TD

The Toronto-Dominion Bank's recent performance is driven by strong earnings and revenue growth. The company's Q3 2025 earnings call highlighted robust results, with a revenue of $10.22 billion, beating EPS estimates. Desjardins upgraded the stock to Buy, citing a strong Canadian P&C business and deposit base. TD Bank Group also presented a strategy to accelerate growth and enhance performance, including plans to slash costs with AI and revive medium-term growth targets, aiming for C$2 billion to C$2.5 billion in annualized cost savings.

1.c. Company Highlights

2. TD Bank Beats Expectations with Strong Q3 Earnings

TD Bank Group reported a robust Q3 2025 with earnings of $3.9 billion and EPS of $2.20, surpassing analyst estimates of $2.04. The actual EPS came in at $2.19. Revenue growth was driven by robust fee and trading income in its markets-driven businesses and volume growth in Canadian Personal and Commercial Banking, resulting in 10% revenue growth. The bank delivered positive operating leverage, reflecting strong revenue growth that offset elevated expenses driven by governance and control costs and investments to drive business growth.

Publication Date: Aug -29

📋 Highlights
  • Strong Earnings & Capital Position: TD Bank Group reported Q3 2025 earnings of $3.9 billion (EPS $2.20) and a CET1 ratio of 14.8%, with CAD 4 billion spent on 46 million share repurchases.
  • Canadian Banking Growth: Canadian Personal and Commercial Banking achieved record revenue and RESL volumes exceeding $400 billion, driven by loan and deposit growth.
  • U.S. Restructuring Progress: U.S. Retail completed a 10% asset reduction ($17 billion total balance sheet reduction) and plans $18 billion in further loan runoff by 2026.
  • Restructuring Impact: The CFO outlined $550M–$650M annual pretax savings from restructuring by 2025, offset by $600M–$700M in charges over several quarters.

Segment Performance

Canadian Personal and Commercial Banking delivered a strong quarter with record revenue, earnings, deposits, and loan volumes. The bank saw strong performance across its distribution channels, with RESL volumes surpassing $400 billion. U.S. Retail made significant progress on balance sheet restructuring, completing the investment portfolio repositioning and achieving a 10% asset reduction.

Credit Performance and Provisions

Ajai K. Bambawale discussed the bank's credit performance, reporting a decrease in provision for credit losses and an increase in gross impaired loans. The bank's allowance for credit losses increased, reflecting additional performing reserves relating to policy and trade uncertainty. The bank expects fiscal 2025 PCL results to fall within the range of 45 to 55 basis points.

Valuation and Dividend Yield

TD Bank's current P/TBV ratio is 1.41, and Dividend Yield is 4.09%. With the bank's strong earnings growth and positive operating leverage, the current valuation appears reasonable. Analysts estimate next year's revenue growth at 2.9%, indicating a stable outlook for the bank.

Restructuring and Cost Savings

Kelvin Tran discussed the bank's restructuring program, which is expected to generate savings of approximately $100 million pretax in fiscal 2025 and annual run-rate savings of $550 million to $650 million pretax. The program is expected to incur total restructuring charges of $600 million to $700 million pretax over several quarters.

Outlook and Investor Day

TD will host an Investor Day on September 29 to share its strategy and medium-term outlook. The bank expects to provide more information on its investment profile and growth strategies, which could potentially impact its valuation and investor sentiment.

3. NewsRoom

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The Toronto-Dominion Bank (TD) Q4 2025 Earnings Call Highlights: Record Earnings and Strategic ...

Dec -04

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TSX Closer: Sets Fresh Record Close On Improved Commodity Prices and Optimism Around Economy

Dec -04

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Canadian Big Bank Earnings Top Expectations, Raise Dividends

Dec -04

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TD Bank Pushes Up Dividend After Underlying Earnings, Revenue Beat Expectations

Dec -04

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Netflix in lead for WBD bid, Canadian banks top earnings estimates

Dec -04

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Correction To TSX Closer: Up For the First Time This Week, Back To Near Last Friday's Record Close

Dec -04

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TD Bank Pushes Up Dividend After Underlying Earnings, Revenue Beat Expectations

Dec -04

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Toronto-Dominion Bank (TD) Beats Q4 Earnings and Revenue Estimates

Dec -04

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.34%)

6. Segments

Canadian Personal and Commercial Banking (CAD P&C)

Expected Growth: 8.0%

The Canadian Personal and Commercial Banking (CAD P&C) segment growth of 8.0% is driven by strong performance in personal deposits, mortgages, and business loans. Organic growth, strategic acquisitions, and market share gains also contribute to this growth. Additionally, TD's investments in digital platforms and customer experience enhancements have helped to drive engagement and attract new customers.

U.S. Retail

Expected Growth: 9.5%

The 9.5% growth in U.S. Retail from The Toronto-Dominion Bank is driven by factors such as increased consumer spending, improved economic conditions, and effective sales strategies. A strong labor market and rising wages have boosted consumer confidence, leading to higher retail sales. Additionally, the bank's investments in digital transformation and customer experience have likely contributed to its growth in the U.S. retail sector.

Wealth Management and Insurance

Expected Growth: 10.5%

The Toronto-Dominion Bank's Wealth Management and Insurance segment growth of 10.5% is driven by strong performance in Canadian Personal and Commercial Banking, robust assets under management, and increased insurance premiums. The growth is also attributed to the bank's strategic investments in digital platforms and customer acquisition, leading to expanded market share and improved profitability.

Corporate

Expected Growth: 7.0%

The Toronto-Dominion Bank's 7.0% growth is driven by strong performance in Canadian retail banking, wealth management, and capital markets. Key factors include expanding loan portfolios, increased market share, and strategic investments in digital transformation, enhancing customer experience and driving operational efficiency.

Wholesale Banking

Expected Growth: 11.0%

The Toronto-Dominion Bank's Wholesale Banking segment growth of 11.0% is driven by strong performance in corporate and investment banking, robust trading revenues, and increased market share in key markets. Strategic investments in digital platforms and talent acquisition have also contributed to this growth, enabling the bank to capitalize on emerging opportunities and deepen client relationships.

7. Detailed Products

Personal Banking

The Toronto-Dominion Bank offers various personal banking products and services, including chequing and savings accounts, credit cards, mortgages, and personal loans.

Business Banking

The bank provides a range of business banking products and services, including business chequing and savings accounts, business credit cards, and cash management solutions.

Wealth Management

The Toronto-Dominion Bank offers wealth management products and services, including investment and retirement accounts, financial planning, and investment advice.

Credit Cards

The bank issues a range of credit cards, including cash back, rewards, and low-interest cards.

Mortgages

The Toronto-Dominion Bank offers various mortgage products, including fixed-rate and variable-rate mortgages, and mortgage refinancing options.

Insurance

The bank offers various insurance products, including life insurance, health insurance, and property insurance.

Investment Banking

The Toronto-Dominion Bank provides investment banking products and services, including corporate finance, mergers and acquisitions, and equity and debt capital markets.

8. The Toronto-Dominion Bank's Porter Forces

Forces Ranking

Threat Of Substitutes

The Toronto-Dominion Bank operates in the financial services industry, where substitutes such as credit unions, online banks, and other financial institutions exist. However, the bank's strong brand reputation, extensive branch network, and wide range of services make it less likely for customers to switch to substitutes.

Bargaining Power Of Customers

The Toronto-Dominion Bank has a large customer base, and customers have some bargaining power due to the availability of alternative financial services providers. However, the bank's customer loyalty programs and competitive pricing mitigate the bargaining power of customers.

Bargaining Power Of Suppliers

The Toronto-Dominion Bank has a large and diversified supplier base, which reduces the bargaining power of individual suppliers. Additionally, the bank's significant market share and financial resources enable it to negotiate favorable terms with suppliers.

Threat Of New Entrants

The Toronto-Dominion Bank operates in a highly regulated industry, and new entrants face significant barriers to entry, such as high capital requirements and regulatory hurdles. This reduces the threat of new entrants.

Intensity Of Rivalry

The Toronto-Dominion Bank operates in a highly competitive industry, with many established players competing for market share. The bank faces intense rivalry from other major Canadian banks, as well as from smaller, more agile competitors.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 80.00%
Debt Cost 18.17%
Equity Weight 20.00%
Equity Cost 9.10%
WACC 16.36%
Leverage 400.02%

11. Quality Control: The Toronto-Dominion Bank passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
TD Bank

A-Score: 7.3/10

Value: 5.6

Growth: 6.3

Quality: 4.8

Yield: 8.0

Momentum: 9.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
JPMorgan Chase

A-Score: 6.7/10

Value: 5.3

Growth: 5.2

Quality: 6.5

Yield: 5.0

Momentum: 8.5

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
BMO

A-Score: 6.7/10

Value: 3.8

Growth: 6.1

Quality: 3.6

Yield: 8.0

Momentum: 8.5

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Citigroup

A-Score: 6.2/10

Value: 6.7

Growth: 4.7

Quality: 4.4

Yield: 5.0

Momentum: 8.5

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Bank of America

A-Score: 6.2/10

Value: 5.6

Growth: 5.3

Quality: 5.0

Yield: 5.0

Momentum: 7.5

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
NatBank

A-Score: 6.1/10

Value: 4.0

Growth: 4.7

Quality: 4.9

Yield: 6.0

Momentum: 7.0

Volatility: 10.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

122.2$

Current Price

122.2$

Potential

-0.00%

Expected Cash-Flows