Once a perennial underperformer, Scotiabank stock is making a comeback
Scotiabank stock has seen a significant rebound, outperforming its peers in the Canadian banking sector over the last three months. Analysts suggest the bank's reasonable valuation and a 'buy-the-laggard' strategy are driving this momentum.
Why it matters
The performance of major banks is a key indicator of Canadian economic health and investor sentiment toward the financial sector.
If you need a clear indication of how well Canadian bank stocks are performing this year, consider this nugget: Even Bank of Nova Scotia is shooting the lights out.
The perennial underperformer among the Big Six lenders has been leading the pack over the past three months, with a gain of more than 15 per cent, as of Thursday.
That’s 10 percentage points better than the average return for the other five banks over the same period, and about 8 percentage points better than the S&P/TSX Composite Index.
Given the upbeat outlook in this week’s quarterly earnings report and the stock’s far more reasonable valuation in a fully valued sector, Scotiabank should be able to maintain the momentum.
Get smarter about the news
Sign up free for a feed built around what you actually care about, Dive Deeper research on any story, and the full text of every article.
Create free accountAlready have an account? Sign in