National Bank of Canada (NA) AI Stock Analysis

• Market Cap: C$74.17B
• Dividend Yield: 2.64%
• Average Volume (3M): 1.97M
• Price to Earnings (P/E): 12.6
• Beta (1Y): 0.83
• Revenue Growth: 7.50%
• EPS Growth: -5.28%
• Country: CA
• Employees: 29,508
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Diversified
• EPS (TTM): 3.25
• Shares Outstanding: 388,346,600
• 10 Day Avg. Volume: 1,752,000
• 30 Day Avg. Volume: 1,970,101
• PEG Ratio: -2.65
• Price to Book (P/B): 1.76
• Price to Sales (P/S): 1.93
• P/FCF Ratio: 14.35
• 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$191.09
• Price Target Upside: 0.06% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): 12.57
• Revenue Forecast (FY): C$15.36B

• Rating: 58 Neutral
• Price Target: C$198.00 ▲(3.68% Upside)
• Action: Downgraded Date: 03/03/26
• Date: Action: Downgraded 03/03/26

The score is held back primarily by balance-sheet leverage rising materially and volatile/negative TTM cash flow, despite solid profitability and ROE. Technicals are supportive due to a strong uptrend, but overbought indicators increase near-term risk. Valuation is reasonable with a moderate P/E and a modest dividend yield.

Positive Factors

Strong Profitability & ROE

Sustained high net margins and above-average ROE indicate the bank earns attractive returns on equity and has pricing power across core businesses. This underpins long-term capacity to reinvest, support dividends and fund strategic initiatives even through economic cycles.

Recent Revenue Momentum

Material TTM revenue acceleration reflects stronger client activity and successful growth initiatives, which can drive scale benefits and higher fee income. If sustained, this bolsters recurring earnings and improves operating leverage over the coming 2–6 months.

Diversified Business Mix

A broad revenue base across retail, commercial, wealth and investment banking reduces single-cycle dependence, produces recurring fee streams, and enables cross-sell. This structural diversification supports more stable earnings and resilience to sector-specific shocks.

Negative Factors

Elevated Leverage

A materially higher leverage ratio increases sensitivity to rising funding costs and market stress, tightening capital flexibility. Persistently elevated leverage can constrain lending, heighten regulatory and funding risk, and amplify earnings volatility over the medium term.

Weak and Volatile Cash Generation

Recent negative operating and free cash flow after prior positive years signals weaker cash conversion and higher uncertainty. Persistent cash volatility undermines self-funding for dividends, buybacks and investments, potentially forcing external funding or balance-sheet adjustments.

Inconsistent Revenue & Margin Trends

Despite strong TTM gains, uneven annual revenue growth and fluctuating margins reduce confidence in trend durability. Structural inconsistency complicates planning and capital allocation, increasing execution risk for sustaining recent profitability levels over the medium term.

National Bank of Canada Business Overview & Revenue Model

Company Description

National Bank of Canada provides various financial products and services to retail, commercial, corporate, and institutional clients in Canada and internationally. It operates through four segments: Personal and Commercial, Wealth Management, Financial Markets, and U.S. Specialty Finance and International. The Personal and Commercial segment offers personal banking services, including transaction solutions, mortgage loans and home equity lines of credit, consumer loans, payment solutions, and savings and investment solutions; various insurance products; and commercial banking services comprise credit, and deposit and investment solutions, as well as international trade, foreign exchange transactions, payroll, cash management, insurance, electronic transactions, and complimentary services. The Wealth Management segment comprises investment solutions, trust services, banking services, lending services, and other wealth management solutions. The Financial Markets segment offers corporate banking, advisory, and capital markets services; and project financing, debt, and equity underwriting; advisory services in the areas of mergers and acquisitions, and financing. The U.S. Specialty Finance and International segment provides specialty finance products; financial products and services to individuals and businesses in Cambodia; and investment solutions, guaranteed investment certificates, mutual funds, notes, structured products, and monetization. It provides its services through a network of 384 branches and 927 banking machines. National Bank of Canada was founded in 1859 and is based in Montreal, Canada.

How the Company Makes Money

National Bank of Canada generates revenue through several key streams, primarily from interest income on loans and mortgages issued to customers, as well as fees from various banking services such as account maintenance, transactions, and financial advisory services. Additionally, the bank earns income from wealth management services, including asset management and investment advisory fees. Investment banking activities, such as underwriting and advisory services for corporate clients, also contribute significantly to its earnings. The bank's strong relationships with corporate clients and its commitment to expanding its digital banking capabilities further enhance its revenue potential. Overall, the diverse range of services and a robust customer base play a crucial role in the bank's financial performance.

National Bank of Canada Financial Statement Overview

Summary

Profitability and ROE are solid (TTM net margin ~15.8%, ROE ~13.5%) and TTM revenue growth is strong (+22.8%), but this is offset by materially higher leverage (debt-to-equity ~4.44 in 2025, elevated in TTM) and a sharp TTM cash flow deterioration (negative operating and free cash flow), which raises risk and reduces confidence in sustainability.

Income Statement

Profitability is solid and improving in the most recent period: TTM (Trailing-Twelve-Months) net margin is ~15.8% with operating profitability around ~20%, and revenue growth is strong (+22.8% in TTM). However, the annual revenue trend is not consistently strong (only ~1.8% growth in 2025 vs. prior year), and margins appear more volatile across years (including an anomalous annual operating margin print in 2023), which reduces confidence in trend stability.

Balance Sheet

Returns on shareholder capital are healthy for a bank (ROE ~11.9% in 2025 and ~13.5% in TTM), but leverage has risen materially: debt-to-equity increased from ~2.1–2.9 (2022–2024) to ~4.44 in 2025 and remains elevated in TTM. Assets have grown steadily, yet the higher leverage profile increases sensitivity to funding costs, credit shocks, and capital market conditions.

Cash Flow

Cash generation is inconsistent. After strong positive operating and free cash flow in 2023–2025 (including 2025 free cash flow of ~$4.1B), TTM (Trailing-Twelve-Months) shows negative operating cash flow (-$0.6B) and negative free cash flow (-$1.0B) alongside sharply negative free cash flow growth. This volatility suggests weaker near-term cash conversion and higher uncertainty around the sustainability of recent cash generation.

Breakdown	TTM	Oct 2025	Oct 2024	Oct 2023	Oct 2022	Oct 2021
Income Statement
Total Revenue	26.97B	30.80B	10.83B	9.77B	9.62B	8.90B
Gross Profit	13.68B	13.01B	10.84B	10.16B	9.62B	8.90B
EBITDA	6.07B	5.79B	5.06B	0.00	4.73B	4.46B
Net Income	4.27B	4.02B	3.82B	3.34B	3.38B	3.14B
Balance Sheet
Total Assets	605.87B	576.92B	462.23B	423.58B	403.74B	355.62B
Cash, Cash Equivalents and Short-Term Investments	36.77B	33.20B	35.75B	39.14B	36.34B	36.81B
Total Debt	97.51B	149.84B	74.78B	53.51B	44.88B	43.64B
Total Liabilities	572.65B	543.15B	436.68B	399.90B	381.99B	336.94B
Stockholders Equity	33.22B	33.77B	25.55B	23.68B	21.74B	18.68B
Cash Flow
Free Cash Flow	-1.04B	4.13B	3.95B	4.51B	-2.59B	5.55B
Operating Cash Flow	-638.00M	4.63B	4.65B	5.17B	-1.92B	9.31B
Investing Cash Flow	-27.66B	-7.08B	-7.34B	-80.00M	-1.46B	1.39B
Financing Cash Flow	31.81B	-1.18B	-1.10B	19.51B	-381.00M	-1.74B

National Bank of Canada Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 190.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:NA, the sentiment is Positive. The current price of 190.98 is above the 20-day moving average (MA) of 177.44, above the 50-day MA of 173.04, and above the 200-day MA of 153.42, indicating a bullish trend. The MACD of 5.73 indicates Negative momentum. The RSI at 76.59 is Negative, neither overbought nor oversold. The STOCH value of 85.14 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:NA.

National Bank of Canada Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RY	69 Neutral	C$317.02B	13.71	15.48%	2.58%	2.13%	25.16%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
TD	67 Neutral	C$227.58B	13.22	17.76%	3.34%	3.07%	144.41%
CM	64 Neutral	C$127.22B	9.41	14.85%	3.07%	-3.13%	18.22%
BMO	62 Neutral	C$138.87B	16.35	10.53%	3.61%	-1.30%	20.41%
BNS	62 Neutral	C$123.81B	14.70	10.39%	4.32%	-3.65%	-1.73%
NA	58 Neutral	C$74.17B	12.62	13.53%	2.64%	7.50%	-5.28%

National Bank of Canada Corporate Events

National Bank of Canada Starts 2026 With 26% Profit Surge on CWB Acquisition

National Bank of Canada posted a strong start to fiscal 2026, with first-quarter net income rising 26% year over year to $1.254 billion, driven by solid performance across all segments and the consolidation of Canadian Western Bank. Diluted earnings per share increased 11% to $3.08, while adjusted net income climbed 26% to $1.32 billion and adjusted EPS reached $3.25, reflecting disciplined execution on growth and efficiency.

Return on common shareholders’ equity remained robust at 15.7% on a reported basis and 16.6% on an adjusted basis, with capital ratios staying strong as the CET1 ratio came in at 13.7% under Basel III. In the Personal and Commercial segment, net income jumped 47% to $427 million, supported by the inclusion of CWB, double-digit growth in personal lending and a 54% surge in commercial lending, even as net interest margins edged slightly lower and expenses rose with the expanded franchise.

The most recent analyst rating on (TSE:NA) stock is a Hold with a C$177.00 price target. To see the full list of analyst forecasts on National Bank of Canada stock, see the TSE:NA Stock Forecast page.

National Bank of Canada Moves to Expand Share Buyback Program

National Bank of Canada plans to amend its existing normal course issuer bid to significantly increase the number of common shares it can buy back and cancel, subject to regulatory approvals. The proposed change would raise the maximum repurchase limit from 8,000,000 to 14,500,000 shares, or 3.70% of its outstanding common stock, with the program running through September 24, 2026 and executed on Canadian trading venues at prevailing market prices, enhancing the Bank’s capital management flexibility.

The move underscores the Bank’s intent to use share buybacks as a tool to optimize its capital structure, which may support earnings per share and signal confidence in its financial position to investors. All repurchased shares will be cancelled, and while the timing and actual volume of purchases will be determined by the Bank, no other terms of the current buyback program are being altered, maintaining continuity for shareholders and market participants.

The most recent analyst rating on (TSE:NA) stock is a Hold with a C$177.00 price target. To see the full list of analyst forecasts on National Bank of Canada stock, see the TSE:NA Stock Forecast page.

National Bank of Canada Moves to Boost Share Buyback Capacity

National Bank of Canada plans to significantly expand its ongoing share repurchase program by seeking approval to increase the maximum number of common shares it can buy back for cancellation to 14,500,000, or 3.70% of its outstanding float. The current program, launched in September 2025, authorizes repurchases of up to 8,000,000 shares, and the amended limit, expected to take effect around March 12, 2026, will run unchanged in all other respects until its scheduled expiry on September 24, 2026.

The buyback will be conducted through the Toronto Stock Exchange and Canadian alternative trading systems at prevailing market prices, with all repurchased shares to be cancelled. By enlarging the scope of its normal course issuer bid, the bank is bolstering its flexibility in capital management, a move that could support capital ratios, signal confidence in its valuation and potentially enhance returns for shareholders through reduced share count.

The most recent analyst rating on (TSE:NA) stock is a Hold with a C$177.00 price target. To see the full list of analyst forecasts on National Bank of Canada stock, see the TSE:NA Stock Forecast page.