Balanced Outlook: National Bank of Canada’s Mixed Performance Justifies Hold Rating

Canaccord Genuity analyst Matthew Lee maintained a Hold rating on National Bank of Canada (NTIOF – Research Report) today and set a price target of C$130.00.

Matthew Lee has given his Hold rating due to a combination of factors that reflect both strengths and challenges for the National Bank of Canada. The bank reported a significant increase in adjusted cash EPS, surpassing market expectations, and demonstrated strong revenue growth across several segments, particularly in Financial Markets. However, despite these positive results, certain areas like Wealth Management and P&C Banking did not meet expectations, with higher expense growth impacting overall performance.
Furthermore, while the bank’s CET1 ratio aligns with market expectations, indicating solid capital management, the slight decline in core NIM and the increase in PCLs suggest some underlying pressures. The integration of CWB is progressing, but its impact on financial metrics adds a layer of complexity. These mixed results, with notable strengths but also areas of concern, underpin Matthew Lee’s decision to maintain a Hold rating, reflecting a balanced view of the bank’s current position and future prospects.

In another report released on May 20, Barclays also maintained a Hold rating on the stock with a C$140.00 price target.

Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of NTIOF in relation to earlier this year.