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Toronto Dominion Bank (TSE:TD)
TSX:TD
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Toronto Dominion Bank
(TSX:TD)
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Rating:74Outperform
Price Target:
C$141.00
â–²(8.33% Upside)
Toronto Dominion Bank's overall score is driven by strong earnings performance and strategic initiatives, despite challenges with high leverage and cash flow volatility. Technical indicators show bullish momentum, while valuation metrics suggest a fair market price. The earnings call provided positive sentiment, reinforcing the bank's strategic direction and resilience.
Positive Factors
Revenue Growth
The 10% revenue growth in Q3 2025 indicates robust business expansion and effective market strategies, supporting long-term financial health.
Strategic Initiatives
The launch of TD AI Prism reflects a commitment to innovation, potentially driving future growth and competitive advantage through enhanced client services.
Market Position
Record achievements in Canadian banking demonstrate TD's strong market position, which can sustain its competitive edge and revenue streams.
Negative Factors
High Leverage
High leverage poses risks to financial stability, potentially limiting the bank's ability to invest in growth and weather economic downturns.
Cash Flow Volatility
Volatile cash flow can hinder TD's ability to fund operations and strategic initiatives, impacting long-term financial flexibility and growth.
Increased Impaired Loans
Rising impaired loans signal potential credit quality issues, which could lead to higher provisions and impact profitability and financial health.
Toronto Dominion Bank (TD) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$220.87B
Dividend Yield3.34%
Average Volume (3M)4.83M
Price to Earnings (P/E)11.3
Beta (1Y)0.69
Revenue Growth3.07%
EPS Growth144.41%
CountryCA
Employees100,424
SectorFinancial
Sector Strength70
IndustryBanks - Diversified
Share Statistics
EPS (TTM)2.18
Shares Outstanding1,689,496,000
10 Day Avg. Volume4,630,487
30 Day Avg. Volume4,834,388
Financial Highlights & Ratios
PEG Ratio0.00
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.00
Enterprise Value/Revenue0.00
Enterprise Value/Gross Profit0.00
Enterprise Value/Ebitda0.00
Forecast
1Y Price Target
$126.36Price Target Upside-2.92% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Toronto Dominion Bank Business Overview & Revenue Model
Company DescriptionThe 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.
How the Company Makes MoneyTD generates revenue through several key streams, primarily focusing on net interest income and non-interest income. Net interest income comes from the difference between the interest earned on loans and the interest paid on deposits. This includes personal and commercial loans, mortgages, and credit products. Non-interest income is derived from fees for services such as asset management, investment banking, and transaction fees from credit and debit card usage. Additionally, TD benefits from wealth management services, which provide advisory services and investment products for high-net-worth individuals. The bank also engages in strategic partnerships and collaborations, enhancing its service offerings and expanding its customer base. Overall, TD's diversified revenue model, strong presence in both Canadian and U.S. markets, and focus on digital banking innovations contribute significantly to its financial performance.
Toronto Dominion Bank Earnings Call Summary
Earnings Call Date:Aug 28, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 26, 2026
Earnings Call Sentiment Neutral
TD Bank delivered strong financial performance with significant revenue growth and strategic achievements in Q3 2025. However, elevated expenses related to AML remediation and governance pose challenges. Despite increased impaired loans, the bank demonstrated resilience with a robust credit performance.Q3-2025 Updates
Positive Updates
Strong Earnings and Revenue Growth
TD Bank delivered a strong Q3 2025 with earnings of $3.9 billion and EPS of $2.20. Revenue grew 10% year-over-year driven by higher fee income and trading-related revenue.
Positive Operating Leverage
TD achieved positive operating leverage this quarter, reflecting strong revenue growth that offset elevated expenses.
Record Achievements in Canadian Banking
Canadian Personal and Commercial Banking delivered record revenue, earnings, deposits, and loan volumes. RESL volumes surpassed $400 billion.
Progress in U.S. Balance Sheet Restructuring
Significant progress was made in U.S. balance sheet restructuring with a 10% asset reduction target achieved, and the investment portfolio repositioning completed.
Launch of TD AI Prism
TD launched TD AI Prism to enhance client personalization and support growth through AI-driven insights.
Negative Updates
Elevated U.S. AML Remediation Costs
U.S. AML remediation costs were significant, with $500 million expected in fiscal 2025 and similar investments anticipated for fiscal 2026.
Higher Governance and Control Costs
Expenses increased 13% year-over-year, driven by governance and control costs, including investments in AML and other risk programs.
Increased Gross Impaired Loans
Gross impaired loans increased $468 million quarter-over-quarter, largely in the Wholesale Banking and U.S. Commercial Lending portfolios.
Challenges in U.S. Commercial Lending
Higher gross impaired loan formations were noted in the U.S. Commercial Lending portfolio, indicating credit challenges.
Company Guidance
During the TD Bank Group's Q3 2025 earnings call, the bank reported strong financial performance with earnings of $3.9 billion and earnings per share (EPS) of $2.20. The bank achieved a positive operating leverage, driven by a 10% revenue growth, which offset increased expenses related to governance, control costs, and business growth investments. Impaired provisions for credit losses (PCLs) decreased quarter-over-quarter, showcasing robust credit performance, and the bank added $600 million in reserves for policy and trade uncertainty. The Common Equity Tier 1 (CET1) ratio stood at 14.8% at the end of the quarter. Canadian Personal and Commercial Banking saw record revenue and loan volumes, with residential secured lending volumes surpassing $400 billion. U.S. retail banking exhibited core loan growth of 2% year-over-year, while U.S. bank card balances increased by 12%. The wealth management sector reported a 12% increase in total client assets, and wholesale banking generated over $2 billion in revenue for the third consecutive quarter. Additionally, TD Bank has been actively implementing a strategic relationship with Fiserv to streamline its portfolio and reduce costs, further enhancing financial performance.Toronto Dominion Bank Financial Statement Overview
Summary
Toronto Dominion Bank shows strong profitability and operational efficiency, but faces challenges with revenue growth and high leverage. Cash flow volatility and high debt levels are areas of concern that need to be addressed to ensure long-term financial stability.Income Statement
Toronto Dominion Bank's income statement shows a strong gross profit margin and consistent net profit margin over the years. However, recent revenue growth has been negative, indicating potential challenges in revenue generation. The EBIT and EBITDA margins remain healthy, suggesting operational efficiency.Balance Sheet
The balance sheet reflects a high debt-to-equity ratio, which is a concern for financial stability. However, the bank maintains a reasonable return on equity, indicating effective use of equity capital. The equity ratio is stable, but the high leverage poses potential risks.Cash Flow
Cash flow analysis reveals volatility, with a significant decline in free cash flow growth recently. The operating cash flow to net income ratio is negative, indicating cash flow challenges. Despite this, the bank has historically maintained a strong free cash flow to net income ratio.| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 115.84B | 119.17B | 102.25B | 59.44B | 47.72B |
| Gross Profit | 56.78B | 52.00B | 48.59B | 44.70B | 42.49B |
| EBITDA | 25.81B | 12.86B | 14.80B | 22.19B | 19.20B |
| Net Income | 20.54B | 8.84B | 10.63B | 17.43B | 14.30B |
Balance Sheet | |||||
| Total Assets | 2.09T | 2.06T | 1.96T | 1.92T | 1.73T |
| Cash, Cash Equivalents and Short-Term Investments | 156.06B | 230.49B | 116.51B | 156.98B | 194.67B |
| Total Debt | 279.31B | 662.56B | 568.66B | 502.06B | 400.86B |
| Total Liabilities | 1.97T | 1.95T | 1.84T | 1.81T | 1.63T |
| Stockholders Equity | 127.83B | 115.16B | 112.07B | 111.38B | 99.82B |
Cash Flow | |||||
| Free Cash Flow | -4.16B | 52.76B | -67.15B | 37.49B | 49.00B |
| Operating Cash Flow | -2.01B | 54.94B | -65.30B | 38.95B | 50.13B |
| Investing Cash Flow | -6.59B | -45.42B | 76.23B | -31.89B | -45.27B |
| Financing Cash Flow | 9.64B | -9.81B | -12.85B | -4.82B | -5.04B |
Toronto Dominion Bank Technical Analysis
Positive
130.16
Price Trends
120.50
Positive
113.70
Positive
102.71
Positive
Market Momentum
3.10
Positive
69.63
Neutral
67.45
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TD, the sentiment is Positive. The current price of 130.16 is above the 20-day moving average (MA) of 127.78, above the 50-day MA of 120.50, and above the 200-day MA of 102.71, indicating a bullish trend. The MACD of 3.10 indicates Positive momentum. The RSI at 69.63 is Neutral, neither overbought nor oversold. The STOCH value of 67.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:TD.
Toronto Dominion Bank Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $123.31B | 17.09 | 9.19% | 4.32% | -3.65% | -1.73% | |
76 Outperform | $68.28B | 17.19 | 13.53% | 2.64% | 7.50% | -5.28% | |
74 Outperform | $220.87B | 11.30 | 16.78% | 3.34% | 3.07% | 144.41% | |
74 Outperform | C$116.53B | 14.59 | 13.69% | 3.07% | -3.13% | 18.22% | |
73 Outperform | $329.68B | 16.70 | 15.28% | 2.58% | 2.13% | 25.16% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
66 Neutral | $130.22B | 16.03 | 10.10% | 3.61% | -1.30% | 20.41% |
* Financial Sector Average
TSE:TD
Toronto Dominion Bank
130.16
55.72
74.84%
TSE:BMO
Bank Of Montreal
183.27
47.58
35.07%
TSE:BNS
Bank Of Nova Scotia
99.85
29.10
41.13%
TSE:CM
Canadian Bank of Commerce
126.79
38.76
44.03%
TSE:RY
Royal Bank Of Canada
234.68
65.96
39.09%
TSE:NA
National Bank of Canada
173.05
44.59
34.72%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.