Bank Of Nova Scotia (BNS) AI Stock Analysis

• Market Cap: $84.92B
• Dividend Yield: 6.59%
• Average Volume (3M): 5.72M
• Price to Earnings (P/E): 13.5
• Beta (1Y): 0.98
• Revenue Growth: 3.72%
• EPS Growth: -17.99%
• Country: CA
• Employees: 88,722
• Sector: Financial
• Sector Strength: 78
• Industry: Banks - Diversified
• EPS (TTM): 5.06
• Shares Outstanding: 1,245,532,000
• 10 Day Avg. Volume: 8,190,030
• 30 Day Avg. Volume: 5,716,815
• PEG Ratio: 7.01
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.02
• Price to Cash Flow (P/CF): 3.00
• P/FCF Ratio: 1.50
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$77.38
• Price Target Upside: 16.29% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10

Scotiabank demonstrates strong fundamentals, with robust financial performance and a strategic focus on shareholder value through dividends and share buybacks. Despite these strengths, technical indicators suggest current bearish momentum, and heightened credit provisions and potential tariffs introduce risk. Overall, the stock offers a balanced mix of value and growth potential, tempered by macroeconomic uncertainties.

Positive Factors

Earnings

BNS reported adjusted cash EPS above consensus expectations, indicating strong earnings performance.

Financial Performance

Total revenue of $9,372M was up 11.1% year-over-year and beat expectations.

Global Banking & Markets

Global Banking and Markets segment outperformed with a 37% year-over-year increase in adjusted pre-tax pre-provision profit.

Negative Factors

Canadian Banking

Canadian Banking earnings were below estimates due to lower risk-adjusted margins and negative operating leverage.

Credit Risk

Higher provisions for credit losses in Canadian and International Banking indicate increased caution regarding credit risk.

International Banking

The bank's loan balance in International Banking declined by 2% year-over-year, indicating challenges in that segment.

Bank Of Nova Scotia Business Overview & Revenue Model

Company Description

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally. It operates in four segments: Canadian Banking, International Banking, Global Wealth Management, and Global Banking and Markets. The company offers financial advice and solutions, and day-to-day banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and insurance to individuals; and business banking solutions comprising lending, deposit, cash management, and trade finance solutions to small, medium, and large businesses, including automotive financing solutions to dealers and their customers. It also provides wealth management advice and solutions, including online brokerage, mobile investment, full-service brokerage, trust, private banking, and private investment counsel services; and retail mutual funds, exchange traded funds, liquid alternative funds, and institutional funds. In addition, the company offers international banking services for retail, corporate, and commercial customers; and lending and transaction, investment banking advisory, and capital markets access services to corporate customers. Further, it provides online, mobile, and telephone banking services. The company operates a network of 954 branches and approximately 3,766 automated banking machines in Canada; and approximately 1,300 branches and a network of contact and support center internationally. The Bank of Nova Scotia was founded in 1832 and is headquartered in Halifax, Canada.

How the Company Makes Money

Scotiabank generates revenue primarily through interest income and non-interest income. Interest income is earned from the various lending activities such as personal loans, mortgages, and commercial loans. Non-interest income comes from service charges, fees for wealth management and investment banking, as well as trading revenues. The bank also benefits from its international operations, particularly in Latin America and the Caribbean, which contribute to its diversified earnings. Strategic partnerships and acquisitions also play a role in bolstering its service offerings and expanding its market reach, thereby enhancing its revenue streams.

Bank Of Nova Scotia Financial Statement Overview

Summary

Overall, the Bank of Nova Scotia maintains a robust financial position with strong revenue growth and stable cash flows. While profitability margins appear pressured, the bank's solid equity base and cash flow suggest resilience. However, high leverage remains a strategic focus area to mitigate potential financial risks in fluctuating market conditions.

Income Statement

The Bank of Nova Scotia has shown stable revenue growth over the years, with a notable increase in total revenue for the TTM compared to previous years. However, the net profit margin has been fluctuating, and the EBIT margin for the TTM is lower compared to historical figures, indicating some operational challenges. Overall, the income statement reflects steady revenue growth but with potential profitability pressures.

Balance Sheet

The company's balance sheet is characterized by strong equity, with a relatively stable debt-to-equity ratio. The equity ratio is moderate, reflecting a solid foundation amidst high total assets. However, the total debt remains high, which could pose risks if economic conditions change unfavorably. The bank's strong equity position provides a cushion, but leveraging remains an area to watch.

Cash Flow

The Bank of Nova Scotia demonstrates a strong cash flow position, with a healthy free cash flow to net income ratio and consistent operating cash flow. The free cash flow has grown, indicating efficient capital management. The discrepancy between operating cash flow and net income ratio suggests solid cash generation capabilities, which is a positive indicator of liquidity and financial health.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
44.76B	33.62B	31.79B	31.15B	30.91B	31.29B
	Gross Profit
44.76B	33.62B	31.79B	31.15B	30.91B	31.29B
	EBIT
2.10B	0.00	8.69B	28.12B	12.49B	8.32B
	EBITDA
0.00	0.00	0.00	14.20B	14.00B	9.70B
	Net Income Common Stockholders
6.73B	7.76B	7.41B	9.92B	9.62B	6.78B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
59.44B	108.17B	140.83B	119.31B	120.05B	116.50B
	Total Assets
526.66B	1.41T	1.41T	1.35T	1.18T	1.14T
	Total Debt
5.94B	300.67B	313.81B	310.86B	245.66B	7.41B
	Net Debt
-33.59B	236.81B	223.50B	244.96B	159.34B	-69.06B
	Total Liabilities
498.45B	1.33T	1.33T	1.27T	1.11T	1.07T
	Stockholders Equity
27.63B	82.37B	76.93B	73.22B	70.80B	68.13B
Cash Flow		Free Cash Flow
17.39B	15.16B	31.28B	16.37B	-13.27B	55.89B
	Operating Cash Flow
17.74B	15.65B	31.72B	16.94B	-12.81B	56.66B
	Investing Cash Flow
-11.51B	-7.45B	-30.04B	-11.29B	14.70B	-56.46B
	Financing Cash Flow
-5.89B	-8.84B	16.71B	-4.58B	-2.78B	28.13B

Bank Of Nova Scotia Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 66.54
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:BNS, the sentiment is Negative. The current price of 66.54 is below the 20-day moving average (MA) of 67.79, below the 50-day MA of 69.90, and below the 200-day MA of 68.77, indicating a bearish trend. The MACD of -0.76 indicates Negative momentum. The RSI at 34.54 is Neutral, neither overbought nor oversold. The STOCH value of 33.94 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:BNS.

Bank Of Nova Scotia Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BMO	77 Outperform	$69.30B	12.46	10.01%	5.04%	15.63%	66.95%
BNS	68 Neutral	$84.92B	13.46	8.34%	6.59%	3.72%	-17.99%
Sector *	63 Neutral	$12.86B	9.17	9.14%	4.78%	16.41%	-10.11%

Bank Of Nova Scotia Corporate Events

Scotiabank Reports Q1 Earnings Amid Strategic Portfolio Adjustments

Scotiabank reported a significant drop in its first-quarter net income to $993 million, primarily due to a $1,355 million impairment loss from the sale of its banking operations in Colombia, Costa Rica, and Panama. Despite this, the bank’s adjusted net income rose to $2,362 million, with strong performances in Global Wealth Management and Global Banking and Markets. The bank continues to focus on its North American markets and simplifying its international portfolio, as evidenced by recent strategic moves.

Scotiabank Declares Dividend and Updates Share Purchase Plan

Scotiabank has announced a dividend of $1.06 per share on its outstanding common shares, payable on April 28, 2025, to shareholders recorded by April 1, 2025. The bank has decided to continue purchasing common shares on the open market rather than issuing new shares from its treasury, with all associated costs covered by the bank. This decision reflects Scotiabank’s strategic approach to managing shareholder value and market operations.

Scotiabank Revamps Business Segment Reporting for Improved Strategy Execution

Scotiabank has updated its Supplementary Financial Information package, reflecting changes in business segment presentation effective as of November 1, 2024. These changes, which do not affect the bank’s consolidated financial results, are intended to align with its strategy and improve decision-making on pricing and capital allocation. The update affects the bank’s methodology for funds transfer pricing and the reporting of minority investments, aiming for higher liquidity ratios and better comparability across periods.

Scotiabank Transfers Operations to Davivienda, Secures Strategic Stake

Scotiabank has entered into an agreement with Davivienda, transferring its banking operations in Colombia, Costa Rica, and Panama in exchange for a 20% ownership stake in the combined entity. This move aligns with Scotiabank’s strategic plan to enhance profitability and operational efficiency in its non-core markets, while also allowing it to maintain a presence in these regions through a mutual referral agreement.