Financial Data and Key Metrics Changes - The bank reported earnings of $3.6 billion and EPS of $2.02, with total revenue growth of 9% year-over-year driven by higher trading-related and fee income [13][40] - The CET1 ratio was 13.1% at quarter-end, expected to rise to approximately 14.2% post the $8 billion share buyback [15][56] - Total expenses increased by 12% year-over-year, with a significant portion attributed to variable compensation and governance investments [41][50] Business Line Data and Key Metrics Changes - Canadian Personal and Commercial Banking achieved record revenue, PTPP, deposits, and loans, with average loan volumes rising 4% year-over-year [43][44] - US Retail loans grew 1% year-over-year, with bank card balances increasing by 12% [47] - Wealth Management delivered record revenue and assets, with new accounts up 30% year-over-year [51] Market Data and Key Metrics Changes - The bank's US wealth business saw total client assets of $52 billion, up 11% year-over-year [19] - The Canadian Personal and Commercial Banking segment introduced ReSource specialists to enhance customer relationships [17] - Wholesale Banking achieved quarterly revenue exceeding $2 billion for the first time [22] Company Strategy and Development Direction - The bank is undergoing a comprehensive strategic review, focusing on operational excellence and efficiency, with updates expected at an Investor Day in the second half of 2025 [11][28] - The strategic review includes selling non-core assets, such as the recent sale of a 10.1% stake in Schwab, to reinvest in the bank's growth [11][12] - The bank aims to enhance its digital leadership and customer experience through investments in technology, including a generative AI virtual assistant [25][26] Management's Comments on Operating Environment and Future Outlook - Management highlighted tariff and trade risks affecting the economic outlook but emphasized a focus on supporting customers through uncertainty [7][8] - The bank is well-capitalized and prepared to navigate macroeconomic shifts, with a conservative risk appetite [8] - Management expressed confidence in the bank's ability to improve return on equity through fiscal 2025 and into fiscal 2026 [39][109] Other Important Information - The bank's provision for credit losses (PCL) increased to 50 basis points, reflecting policy and trade uncertainty [61] - The bank's allowance for credit losses rose to $9.6 billion, influenced by foreign exchange impacts and credit migration [63] - The bank is committed to ongoing AML remediation efforts, with costs expected to be approximately $500 million pretax in fiscal 2025 [50][100] Q&A Session Summary Question: Regarding U.S. balance sheet repositioning and portfolio sales - Management confirmed that the $9 billion portfolio sale will help reduce higher-cost borrowings, with further reductions expected over time [70][71] Question: On expense guidance and AML remediation costs - The bank incurred $86 million in AML remediation costs in Q1, slightly lower than the previous quarter, with confidence in the $500 million guidance for the year [74][76] Question: About expense growth expectations - Management indicated that while Q2 will see elevated expense growth, the second half of the year is expected to moderate [83][88] Question: On performing provisions and macroeconomic outlook - Management explained that the release in performing provisions was driven by improved macroeconomic forecasts and model updates [92][94] Question: Strategic investments and capital allocation - Management emphasized a focus on efficiency and operational excellence while identifying significant organic growth opportunities for capital allocation [101][104] Question: Clarification on NIM expectations - Management indicated that NIM is expected to normalize and potentially return to previous levels, benefiting from ongoing balance sheet restructuring [137][138]

Quarterly Results Presentation TD Bank Group Q1 2025 February 27, 2025 Caution Regarding Forward-Looking Statements From time to time, the Bank (as defined in this document) makes written and/or oral forward-looking statements, including in this document, in other filings with Canadian regulators or the United States (U.S.) Securities and Exchange Commission (SEC), and in other communications. In addition, representatives of the Bank may make forward-looking statements orally to analysts, investors, the med ...

Core Viewpoint - Toronto-Dominion Bank (TD) reported quarterly earnings of $1.39 per share, exceeding the Zacks Consensus Estimate of $1.38 per share, but down from $1.47 per share a year ago, indicating a slight earnings surprise of 0.72% [1] Financial Performance - The company posted revenues of $9.7 billion for the quarter ended January 2025, missing the Zacks Consensus Estimate by 7.24%, compared to $10.07 billion in the same quarter last year [2] - Over the last four quarters, Toronto-Dominion has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times as well [2] Stock Performance - Toronto-Dominion shares have increased approximately 12.2% since the beginning of the year, significantly outperforming the S&P 500's gain of 1.3% [3] Future Outlook - The company's earnings outlook is crucial for investors, including current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the next quarter is $1.30 on revenues of $10.32 billion, and for the current fiscal year, it is $5.43 on revenues of $42.38 billion [7] Industry Context - The Zacks Industry Rank indicates that the Banks - Foreign sector is currently in the bottom 48% of over 250 Zacks industries, suggesting potential underperformance compared to the top 50% of ranked industries [8]

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Core Viewpoint - The market anticipates a year-over-year decline in earnings for Toronto-Dominion Bank (TD) despite an increase in revenues when it reports its results for the quarter ended January 2025 [1][3]. Earnings Expectations - The earnings report is expected to be released on February 27, 2025, with a consensus EPS estimate of $1.36, reflecting a -7.5% change year-over-year [3]. - Revenues are projected to be $10.45 billion, which is a 3.8% increase from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 2.99% over the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate for TD is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +0.92% [10][11]. Earnings Surprise Prediction - A positive Earnings ESP suggests a potential earnings beat, but the current Zacks Rank for TD is 4 (Sell), complicating the prediction of an earnings beat [11][12]. - Historically, TD has beaten consensus EPS estimates three out of the last four quarters [13]. Industry Context - In the broader context of the Zacks Banks - Foreign industry, Bank of Nova Scotia (BNS) is expected to report earnings of $1.17 per share, indicating a -6.4% year-over-year change, with revenues expected to decline by 1.1% to $6.17 billion [17][18]. - BNS has an Earnings ESP of -1.50% and a Zacks Rank of 4, making it difficult to predict an earnings beat [18].

Core Viewpoint - Toronto-Dominion Bank (TD Bank) offers a high dividend yield of 5.1%, significantly above the S&P 500 average of 1.2% and the average bank yield of 2.3%, making it an attractive option for high-yield bank investments [1] Group 1: Regulatory Issues - TD Bank's U.S. division was involved in money laundering activities, leading to significant regulatory scrutiny and accountability for the bank's internal control failures [3][4] - As a consequence, TD Bank has been placed under an asset cap in the U.S., restricting its ability to grow until it addresses regulatory concerns regarding its money laundering controls [5] - The bank is expected to face a challenging year in 2025 as it restructures its U.S. balance sheet to comply with the asset cap, which may negatively impact its financial performance [5][6] Group 2: Long-term Outlook - Despite current challenges, TD Bank's core Canadian business remains strong and unaffected by the U.S. issues, suggesting potential for recovery and growth beyond 2025 [7] - The bank's long-term growth engine, previously expected to be its U.S. business, will likely experience slower growth until regulatory issues are resolved, but the stock's current low valuation presents a buying opportunity for long-term investors [6][10] - The bank's management increased the dividend by 3% at the end of fiscal 2024, indicating confidence in its ability to maintain dividend payments despite regulatory challenges [9] Group 3: Investment Considerations - TD Bank represents a risk/reward scenario, where investors willing to buy during a downturn may benefit from a historically high dividend yield while waiting for the bank to navigate its regulatory issues [8][10] - The current situation may deter conservative investors, but those with a long-term perspective could find this an opportune time to invest, as the bank is expected to recover and return to growth [11]

Company Performance - Toronto-Dominion Bank (TD) closed at $57.92, reflecting a +0.8% change from the previous day, outperforming the S&P 500's gain of 0.36% [1] - Over the past month, TD shares have increased by 6.05%, while the Finance sector and S&P 500 gained 5.23% and 2.11%, respectively [1] Earnings Forecast - The upcoming earnings report is expected to show an EPS of $1.38, a decrease of 6.12% from the same quarter last year, with projected quarterly revenue of $10.42 billion, up 3.47% year-over-year [2] - For the entire fiscal year, earnings are projected at $5.52 per share and revenue at $42.51 billion, indicating a decline of 3.83% in earnings and an increase of 1.28% in revenue compared to the previous year [3] Analyst Revisions and Outlook - Recent revisions to analyst forecasts are crucial as they reflect near-term business trends, with positive changes indicating a favorable outlook on the company's health and profitability [4] - The Zacks Rank system, which assesses estimate changes, currently ranks TD at 4 (Sell), with a recent downward shift of 0.87% in the EPS estimate [6] Valuation Metrics - TD's Forward P/E ratio stands at 10.4, which is higher than the industry average of 8.83, and its PEG ratio is 1.84 compared to the industry average of 0.96 [7] Industry Context - The Banks - Foreign industry, part of the Finance sector, has a Zacks Industry Rank of 159, placing it in the bottom 37% of over 250 industries [8]

Group 1 - Toronto-Dominion Bank (TD) stock closed at $57.07, reflecting a -0.52% change from the previous trading day, underperforming compared to the S&P 500's loss of 0.51% [1] - Over the last month, TD shares have increased by 8%, outperforming the Finance sector's gain of 5.73% and the S&P 500's gain of 2.87% [1] - Upcoming earnings disclosure is expected to show an EPS of $1.38, a 6.12% decline year-over-year, with quarterly revenue anticipated at $10.42 billion, up 3.47% from the previous year [2] Group 2 - For the entire year, earnings are forecasted at $5.54 per share and revenue at $42.51 billion, indicating a -3.48% change in earnings and a +1.28% change in revenue compared to the previous year [3] - Recent analyst estimate revisions suggest a favorable outlook on TD's business health and profitability [4] - The Zacks Rank system indicates that TD currently holds a rank of 4 (Sell), with a recent 0.51% decrease in the EPS estimate over the last 30 days [6] Group 3 - TD's Forward P/E ratio is 10.35, which is a premium compared to the industry's average Forward P/E of 9.04 [7] - The PEG ratio for TD is 1.83, while the average PEG ratio for the Banks - Foreign industry is 0.99 [7] - The Banks - Foreign industry is ranked 159 in the Zacks Industry Rank, placing it in the bottom 37% of over 250 industries [8]

Key Appointments - TD Bank Group announced two key appointments in financial crime risk management roles, effective January 23 [1] - Jacqueline (Jackie) Sanjuas, previously TD Bank Group's U S Bank Secrecy Act officer, is now the global head of financial crime risk management, succeeding Herb Mazariegos who will leave the company [2] - Stephen Joyce, vice president of financial crime risk management, transformation delivery and enablement, was appointed interim head of financial crime risk management for TD's Canadian and international operations (non-U S ) [4] Leadership Transition - TD Bank Group accelerated its CEO transition, with Chief Operating Officer Raymond Chun set to be appointed group president and CEO on February 1, instead of the previously announced date of April 10 [5] - Bharat Masrani, the outgoing president and CEO, took "full responsibility" for the AML challenges faced by the bank [5] Regulatory and Compliance Issues - TD Bank Group and its U S subsidiaries consented to orders and entered into plea agreements with U S regulators and authorities in October, related to investigations of its Bank Secrecy Act and anti-money laundering (AML) compliance programs [6] - The U S Department of Justice highlighted "long-term, pervasive and systemic deficiencies" in TD Bank's AML program between January 2014 and October 2023, with the bank failing to take appropriate remedial action [6] - TD Bank agreed to a "historic penalty," a four-year monitor to oversee remedial measures, and additional accountability and data governance reviews as part of the settlement with the U S Department of the Treasury [7] Background of Appointees - Jacqueline Sanjuas joined TD Bank Group in January 2024 after 19 years at Citi, where she served as managing director and chief compliance officer of AML and BSA officer [3] - Herb Mazariegos, who is leaving TD Bank Group, joined the company in November 2023 [2]

Group 1 - Proactive provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company focuses on medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - Proactive's news team delivers insights across various sectors including biotech, pharma, mining, natural resources, battery metals, oil and gas, crypto, and emerging technologies [3] Group 2 - Proactive is committed to adopting technology to enhance workflows and improve content production [4] - The company utilizes automation and software tools, including generative AI, while ensuring all content is edited and authored by humans [5]