Bank Of Nova Scotia Earnings Preview

| About: The Bank (BNS)

The Bank of Nova Scotia (NYSE:BNS), together with its subsidiaries, offers various personal, commercial, corporate, and investment banking services in Canada and internationally. It operates in the Money Center Banks industry.

It is scheduled to report its Q2 FY2012 results on May 29, 2012, before the market opens.

Recent EPS Actuals vs. Estimates

The company has met or exceeded analyst estimates in three out of four last quarters. In the last quarter it reported $1.23 EPS, beating consensus analyst estimates of $1.14 EPS.

Analyst Estimates

The consensus for EPS is $1.15 based on 16 analysts' estimates, down from $1.38 a year ago. The average target price by analysts for the stock is $59.74.

Average recommendation: Overweight

BNS Recommendations

Source: Marketwatch

Key Metrics

  • Market cap: $56.91B
  • 52 week trading range: 45.79 - 61.83
  • Trailing P/E: 10.82
  • Forward P/E: 9.68
  • P/S: 3.48
  • P/B: 2.01
  • PEG Ratio: 1.23
  • Annual dividend yield: 4.4%
  • Total debt: $93.93B
  • Return on Equity: 17.36%
  • Return on Assets: 0.93%

Latest Developments

  • On May 22, 2012, Reuters reported that The Bank of Nova Scotia has agreed to sell the Toronto office towers that house its corporate headquarters for CAD1.27 billion ($1.25 billion) to a pair of Canadian real estate investment trusts (REITs).
  • On April 17, 2012, The Bank of Nova Scotia announced that it has closed the acquisition by Scotia Capital Inc. of Howard Weil Incorporated, a U.S.-based energy investment boutique. Terms of the transaction were not disclosed and are not financially material to Scotiabank.
  • On March 29, Ex-Date for dividend payment of $0.55.
  • On March 6, The Bank of Nova Scotia announces dividend on outstanding shares.
  • On February 9, 2012, The Bank of Nova Scotia announced that it has completed its previously announced public offering of 33 million common shares, at a price of $50.25 per common share, for gross proceeds of $1,658,250,000.
  • On February 1, 2012, The Bank of Nova Scotia announced that a public offering of 30 million common shares, at a price of $50.25 per common share, for gross proceeds of $1,507,500,000.
  • On January 18, 2012, The Bank of Nova Scotia announced the closing of its acquisition of 51% of Banco Colpatria. Through this long-term partnership with Mercantil Colpatria, who retains 48.7% ownership, Scotiabank will participate in significant growth opportunities in Colombia. The purchase will be satisfied through a combination of USD500 million in cash and 10,000,000 common shares of The Bank of Nova Scotia.


  • On May 16, 2012, Reuters reported that Royal Bank of Canada (NYSE:RY) and Credit Suisse Group AG (NYSE:CS) are among suitors who have put in initial bids to buy the non-U.S. wealth management business of Bank of America Corporation (NYSE:BAC) in a deal that could be worth about $2 billion.
  • On May 14, 2012, Reuters reported Macquarie Group Limited, Principal Financial Group (NYSE:PFG) and United Overseas Bank Ltd. are among suitors that have submitted bids for ING Groep NV's (NYSE:ING) Asian asset management business in a deal that may be worth around $500 million to $600 million. ING is selling its Asian asset management and insurance businesses in a roughly $7 billion deal to help repay the state bailout it received after the largest Dutch financial services company almost collapsed during the 2008 global crisis.
  • On April 17, 2012, Toronto-Dominion Bank (NYSE:TD) announced that for fiscal 2012, it expects 7% to 10% earnings growth over the medium term.
  • On April 3, 2012, Royal Bank of Canada announced that it has entered into a definitive agreement to acquire the 50% stake that RBC does not already own in the joint venture RBC Dexia Investor Services Limited (RBC Dexia) from Banque Internationale à Luxembourg S. A. (formerly Dexia Banque Internationale à Luxembourg S. A.) for total consideration of EUR837.5 million (CAD1.1 billion) in cash.
  • On March 20, 2012, Royal Bank of Canada announced its global wealth division RBC Wealth Management will acquire the Latin American, Caribbean and African private banking business of Coutts, the wealth division of Royal Bank of Scotland Group.

Technical Insight

Here are weekly and daily charts for BNS. The weekly graph shows that recently it tested the 200-week moving average. Moreover, if you draw a Fibonacci retracement levels from the uptrend, which started in March 2009 and reached the recent highs in the spring of 2011, it has tested the 38.2% Fibonacci level and has rebounded back up. In the daily chart you can see the strong downtrend. I would suggest it tests 200-week moving average again during this summer, unless there are major fundamentals in play.

See a list of other major stocks reporting earnings in week 22 (May 28-31).

Sources: Yahoo Finance, Google Finance, CNBC, Marketwatch, Reuters, Forbes.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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Tagged: , Money Center Banks, Canada, Earnings
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