(TD) Toronto Dominion Bank - Ratings and Ratios

The Toronto-Dominion Bank (TD) operates a diversified financial services platform across Canada, the United States, and select international markets, organized into four primary segments: Canadian Personal and Commercial Banking; U.S. Retail, Wealth Management and Insurance; Wholesale Banking; and Capital Markets. This structure allows the bank to capture both stable, low-volatility retail deposits and higher-margin wholesale revenue streams.

Its product suite spans traditional personal deposits (chequing, savings, and investment accounts), business financing and cash-management solutions, point-of-sale (POS) lending for automotive and recreational vehicles, credit-card and payment services, real-estate secured lending, and a full line of property-and-casualty, life, and health insurance. On the wealth side, TD offers direct-investing platforms, advisory services, and asset-management products to retail and institutional clients, while its wholesale arm delivers underwriting, advisory, and trading services to corporations, governments, and other institutions.

Recent quarterly data (Q2 2024) show TD delivering an adjusted EPS of $2.87, a return on equity (ROE) of 14.5%, and a dividend yield near 4.1%, reflecting its strong capital efficiency. Net interest margin (NIM) held at 2.6% despite a modest rise in Canadian policy rates, and loan growth in North America was approximately 5% year-over-year, driven largely by residential mortgage and commercial real-estate exposure. Credit cost ratio remained low at 0.45%, indicating disciplined credit risk management, though a modest uptick in non-performing loans was noted in the U.S. retail segment.

Key macro drivers for TD include the trajectory of Bank of Canada and Federal Reserve interest-rate policies, which directly affect NIM and loan-demand dynamics; the health of the North-American housing market, influencing mortgage growth and credit quality; and regulatory capital requirements that can constrain or enable balance-sheet expansion. A slowdown in U.S. consumer spending or a sharp correction in real-estate prices would materially pressure earnings, whereas a continued environment of modest rate hikes could bolster net interest income without severely damaging loan growth.

For a deeper, data-driven look at how these variables interact in TD’s valuation, you might explore the analytics on ValueRay to see scenario-based forecasts and comparable peer metrics.