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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

Toronto-Dominion Bank's recent momentum is driven by record Q1 earnings, a sizable share buyback program, and accelerated investments in technology and AI. The bank's Canadian Personal Banking franchise is seeing gains in credit card acquisitions, deposit growth, and real estate secured lending. A targeted CA$500 million revenue and expense improvement from automation is expected, with institutional investors increasing their ownership stake to 52.37%. Jefferies highlights the bank as a leader in AI adoption, maintaining a Hold rating.

1.c. Company Highlights

2. TD Bank's Q1 2026 Earnings: A Strong Start to the Year

TD Bank reported record earnings of $4.2 billion and EPS of $2.45, beating analyst estimates of $2.27. Revenue grew 11% year-over-year, driven by growth across all business lines. The bank's net interest margin (NIM) is expected to remain relatively stable in Q2, with a modest increase expected. The actual EPS of $2.45 was a significant beat, indicating strong operational performance.

Publication Date: Feb -27

📋 Highlights
  • Record Earnings and EPS:: TD Bank Group reported $4.2 billion in earnings with EPS of $2.44, achieving an ROE of 4.2% (year-over-year increase of 100 bps).
  • Positive Operating Leverage:: Delivered three consecutive quarters of positive operating leverage, with year-over-year expense growth moderating to 7%.
  • U.S. Banking Momentum:: U.S. segment saw 22% year-over-year earnings growth, 7% PTPP increase, and a 330 bps ROCE expansion to 14.7%.
  • Restructuring Costs and Savings:: Incurred $200M pretax restructuring charges but expects $775M annual savings, targeting $2–2.5B in medium-term cost reductions via AI and automation.
  • Wholesale Banking Strength:: Generated record revenue and earnings, with 5% expense growth due to tech investments and 43 bps total PCLs within guided ranges.

Segment Performance

The Canadian Personal and Commercial Banking segment delivered record revenue, PTPP, earnings, deposit, and loan volumes. In the U.S., the bank saw continued momentum across its core business lines, with mid-market lending balances up 4% year-over-year. Wealth Management and Insurance also delivered record earnings and assets, driven by market share gains and strong pipeline growth.

Expense Management and Efficiency

The bank continued to moderate its expense growth, with a 7% year-over-year increase, driven by variable compensation, foreign exchange, and the impact of the U.S. strategic card portfolio. The bank is targeting $2 billion to $2.5 billion in annualized cost savings over the medium term, with AI expected to play a key role in driving these savings.

Capital Position and Valuation

The bank's common equity Tier 1 ratio ended the quarter at 14.5%, down 15 basis points sequentially. The bank remains committed to consistently returning excess capital to its shareholders. With a P/TBV ratio of 1.8, the bank's valuation appears reasonable. The dividend yield of 3.13% is also attractive, making the stock a compelling investment opportunity for income investors.

Outlook and Guidance

The bank is confident in its ability to deliver for its shareholders, with a target ROE of 16% by the end of 2027. The bank is also targeting a 40% efficiency ratio, with AI expected to drive further improvements in efficiency and ROE. Analysts estimate revenue growth of 4.1% next year, indicating a stable outlook for the bank's top-line performance.

3. NewsRoom

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TD Bank Group Issues CHF 150 Million Green Bond

Apr -30

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Confident but Cautious: TD Survey Finds Small Business Owners Optimistic About the Future, Yet Many Still Lack a Financial Safety Net

Apr -28

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You should pick your credit card perks like Warren Buffett picks his stocks, TD Bank exec says

Apr -27

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TSX Dividend Stocks Spotlighting 3 Yield Opportunities

Apr -27

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Higher Prices Rather Than Broad-based Demand Growth May Be Driving Canada Retail Sales Momentum, says TD

Apr -24

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3 Top TSX Dividend Stocks To Watch With Up To 5.6% Yield

Apr -24

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TSX Dividend Stocks Featuring 3 Income Generating Picks

Apr -23

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Is It Too Late To Consider Toronto Dominion Bank (TSX:TD) After Its Strong Share Price Run?

Apr -21

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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: 7.1/10

Value: 5.2

Growth: 6.3

Quality: 4.9

Yield: 7.0

Momentum: 9.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
BMO

A-Score: 7.0/10

Value: 5.1

Growth: 6.6

Quality: 4.1

Yield: 8.0

Momentum: 8.5

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
JPMorgan Chase

A-Score: 6.6/10

Value: 5.6

Growth: 5.2

Quality: 6.5

Yield: 5.0

Momentum: 8.5

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
NatBank

A-Score: 6.5/10

Value: 3.7

Growth: 6.4

Quality: 4.9

Yield: 6.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Citigroup

A-Score: 6.4/10

Value: 6.3

Growth: 4.7

Quality: 4.4

Yield: 6.0

Momentum: 9.0

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Bank of America

A-Score: 6.0/10

Value: 5.4

Growth: 5.2

Quality: 4.9

Yield: 4.0

Momentum: 7.5

Volatility: 9.0

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

146.33$

Current Price

146.33$

Potential

-0.00%

Expected Cash-Flows