Bank stocks are popular among Canadian investors as the country's banking sector is considered to be one of the best ones in the world. During the financial crisis of 2008, when most of the banks failed across the world, Canadian banks proved to be quite resilient.
Even during the coronavirus pandemic, Canadian bank stocks bounced back to provide gains and distribute dividends among its shareholders. If you are looking to invest in the Toronto Stock Exchange (TSX)-listed banks, you could consider exploring the stocks of Royal Bank of Canada (TSX:RY) and Canadian Imperial Bank Of Commerce (TSX:CM).
Royal Bank of Canada (TSX:RY)
Royal Bank of Canada is all set to release its second-quarter fiscal 2021 results on May 27. According to current estimates, the bank is expected to post basic earnings per share (EPS) of C$ 2.4, up from a prior estimate of C$ 2.2.
In the past three years, the bank's dividend grew at the rate of about six per cent and it currently distributes C$ 1.08 as a quarterly dividend. Its price-to-earnings (P/E) ratio is 15.1 and its return on equity is 14.5 per cent, as per TMX.
1-year chart of stock performance, volume and moving average of Royal Bank of Canada (Source: Refinitiv)
RY shares closed at C$ 122.29 apiece on Monday, May 17, having grown by three per cent in the last month. The bank’s 30-day average trading volume stands at over 4.7 million.
Royal Bank of Canada’s one-year stock price growth is about 48 per cent. Since the beginning of this year, the scrip climbed about 17 per cent.
The bank's net income was C$ 3,847 million in first-quarter fiscal 2021, up by C$ 338 million year-over-year (YoY).
Canadian Imperial Bank Of Commerce (TSX:CM)
The Canadian Imperial Bank of Commerce (CIBC) continued to deliver notable results amid the coronavirus pandemic. It has outperformed much of the Canadian banking sector.
In the last year, CM stock surged by 68 per cent, while the S&P TSX Diversified Banks (Sub Industry) Index climbed about four per cent.
As the country progresses on the path of economic recovery, it is likely to drive CM stock’s growth further and might provide long-term gains to the investors.
Currently, CIBC distributes a quarterly dividend of C$ 1.46 and registers a dividend yield of 4.4 per cent.
1-year chart of stock performance, volume and moving average of CIBC (Source: Refinitiv)
In the past three months, CM stock grew by 17.5 per cent. Its one-month growth sits at 6.8 per cent.
On Monday, CM shares were up by about 64 per cent from its 52-week low of C$ 81.28 (May 19, 2020).
In Q1 2021, CIBC’s net income increased by 34 per cent YoY to C$ 1,625 million. In the same quarter, its diluted EPS was C$ 3.58, up by 35 per cent from Q1 2020.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view.