The Bank of Nova
Scotia is Canada ’s
third largest bank with operations in Canada ,
the US and 50
foreign countries. BNS has earned a 14-20%
return on equity over the last ten years and
has grown profits and dividends at a 8-13% pace. While the 2008-2009
financial credit crisis impacted BNS ,
it weathered the storm much better than
most large US
banks and should continue to grow earnings and dividends as a result of:
(1) expansion of
its broadly diversified global loan portfolio,
(2) acquisitions
in the overseas markets,
(3) a very
strict cost control program,
(4) strong
growth in savings deposits,
(5) rapid
revenue increases in its newly formed wealth management group,
(6) increased
banking fees,
(7) launch of
Scotiabank American Express travel card.
Negatives:
(1) a slowdown
in the Canadian mortgage market,
(2) increased
losses on commercial loans,
(3) margin
pressures.
Statistical Summary
Stock Dividend Payout # Increases
Yield Growth Rate Ratio
Since 2003
Debt/ EPS Down Net Value Line
Equity ROE Since 2003 Margin Rating
*banks’ income statements don’t
provide a Net Margin number
Chart
Note:
BNS stock made good progress off its March
2009 low, surpassing the downtrend off its November 2007 high (straight red
line) and the November 2008 trading high (green line). Long term it is in an uptrend (blue
lines). Intermediate term it is an
uptrend (purple line). The wiggly red
line is the 50 day moving average. The
High Yield Portfolio owns a full position in BNS . The upper boundary of its Buy
Value Range Sell
Half Range
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