BMO Capital Boosts TD Bank Outlook
BMO Capital has raised its Toronto-Dominion Bank (TD) price target to C$107 from C$102, maintaining an Outperform rating. The bank has delivered a 55.46% return year-to-date, trading near its 52-week high of $79.83.
The upgrade follows TD Bank’s investor day, where it reaffirmed a medium-term EPS growth target of 7-10% and a return on equity target of approximately 16% based on a CET1 ratio of 13%.
Strong Earnings Drive Confidence
BMO Capital cited higher-than-expected U.S. retail earnings and robust share buybacks as key drivers for raising the 2026 EPS estimate from $8.45 to $8.80. TD also committed $6-7 billion in share buybacks and projected US$2.9 billion in U.S. Retail earnings.
Eight analysts recently raised earnings estimates, highlighting investor confidence. TD continues its dividend tradition with a current yield of 3.78%.
Operational Efficiency and Growth
TD Bank aims to achieve positive operating leverage with a non-interest expense ratio in the mid-50s range. Non-restructuring programs support this efficiency, according to BMO Capital’s analysis. Anti-money laundering remediation was identified as a top priority.
Recent Quarterly Performance
TD Bank reported Q3 2025 earnings that exceeded expectations. EPS reached $2.20, beating the forecasted $2.04—a 7.84% surprise. Revenue came in at $15.61 billion, surpassing the anticipated $13.73 billion by 13.69%.
While the stock reacted positively in pre-market trading, it opened slightly lower during the regular session. No major mergers or acquisitions were reported, and analysts have issued no recent upgrades or downgrades.
TD Bank’s strong quarterly results, robust EPS growth, and strategic buybacks underline its solid financial position and investor appeal.
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