Barclays on Canadian Financial Services: Value and Relative Safety: Time To Buy
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Price: $205.31 +0.05%
Rating Summary:
10 Buy, 6 Hold, 2 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
10 Buy, 6 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Barclays on Canadian Financial Services: Value and Relative Safety: Time To Buy
Barclays analyst, John Aiken, said, "We are reiterating our Positive rating on the Canadian financials and believe that, similar to the experience in 2008 and 2009, they are likely to outperform many of their global peers on the upside and the downside on a relative basis. While they cannot escape the implications of the European debt crisis or the impact of a slowing U.S. economy, we continue to believe that the health of their domestic markets and overall diversity of their operations allows for a relatively positive outlook for earnings growth. Further, we are not anticipating material capital or even significant earnings implications for the sector through their direct exposures."
"We believe the Canadian banks' valuations remain quite compelling at this stage. While they will likely continue to be dragged down by U.S. financials, we believe that they will outperform on the downside and the upside, similar to 2008/2009. Absolute earnings and profitability remain quite strong, albeit in a slower growth environment and the almost 4.5% average dividend yield remains quite compelling as exposures to U.S. and European sovereign debt is quite manageable in a relative context. We continue to like Royal Bank of Canada (NYSE: RY) heading into Q3 reporting at the end of the month and Toronto-Dominion (NYSE: TD) and CIBC (NYSE: CM) over the next 12 months."
Barclays analyst also notes that Canadian insurer, Manulife (NYSE: MFC) is exposed, but the recent 8% dip in share price is overblown.
Barclays analyst, John Aiken, said, "We are reiterating our Positive rating on the Canadian financials and believe that, similar to the experience in 2008 and 2009, they are likely to outperform many of their global peers on the upside and the downside on a relative basis. While they cannot escape the implications of the European debt crisis or the impact of a slowing U.S. economy, we continue to believe that the health of their domestic markets and overall diversity of their operations allows for a relatively positive outlook for earnings growth. Further, we are not anticipating material capital or even significant earnings implications for the sector through their direct exposures."
"We believe the Canadian banks' valuations remain quite compelling at this stage. While they will likely continue to be dragged down by U.S. financials, we believe that they will outperform on the downside and the upside, similar to 2008/2009. Absolute earnings and profitability remain quite strong, albeit in a slower growth environment and the almost 4.5% average dividend yield remains quite compelling as exposures to U.S. and European sovereign debt is quite manageable in a relative context. We continue to like Royal Bank of Canada (NYSE: RY) heading into Q3 reporting at the end of the month and Toronto-Dominion (NYSE: TD) and CIBC (NYSE: CM) over the next 12 months."
Barclays analyst also notes that Canadian insurer, Manulife (NYSE: MFC) is exposed, but the recent 8% dip in share price is overblown.
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