BANK OF NOVA SCOTIA (BNS.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:BNS - CA0641491075 - Common Stock
102.64 CAD
+0.16 (+0.16%)
Overall BNS gets a fundamental rating of 3 out of 10. We evaluated BNS against 24 industry peers in the Banks industry. Both the profitability and financial health of BNS have multiple concerns. BNS is quite expensive at the moment. It does show a decent growth rate. BNS also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year BNS was profitable.
- In the past year BNS had a positive cash flow from operations.
- In the past 5 years BNS has always been profitable.
- BNS had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- With a Return On Assets value of 0.50%, BNS is not doing good in the industry: 79.17% of the companies in the same industry are doing better.
- With a Return On Equity value of 8.36%, BNS is not doing good in the industry: 66.67% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.5% | ||
| ROE | 8.36% | ||
| ROIC | N/A |
ROA(3y)0.5%
ROA(5y)0.6%
ROE(3y)8.74%
ROE(5y)10.53%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- BNS's Profit Margin of 19.24% is on the low side compared to the rest of the industry. BNS is outperformed by 83.33% of its industry peers.
- In the last couple of years the Profit Margin of BNS has declined.
- The Operating Margin and Gross Margin are not available for BNS so they could not be analyzed.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | 19.24% | ||
| GM | N/A |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y-14.46%
PM growth 5Y-1.74%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- BNS does not have a ROIC to compare to the WACC, probably because it is not profitable.
- BNS has less shares outstanding than it did 1 year ago.
- The number of shares outstanding for BNS has been increased compared to 5 years ago.
- The debt/assets ratio for BNS has been reduced compared to a year ago.
2.2 Solvency
- BNS has a debt to FCF ratio of 46.43. This is a negative value and a sign of low solvency as BNS would need 46.43 years to pay back of all of its debts.
- BNS's Debt to FCF ratio of 46.43 is on the low side compared to the rest of the industry. BNS is outperformed by 62.50% of its industry peers.
- BNS has a Debt/Equity ratio of 2.68. This is a high value indicating a heavy dependency on external financing.
- The Debt to Equity ratio of BNS (2.68) is worse than 70.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.68 | ||
| Debt/FCF | 46.43 | ||
| Altman-Z | N/A |
ROIC/WACCN/A
WACC11.64%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
- BNS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.58%, which is quite good.
- Measured over the past 5 years, BNS shows a small growth in Earnings Per Share. The EPS has been growing by 5.75% on average per year.
- Looking at the last year, BNS shows a quite strong growth in Revenue. The Revenue has grown by 12.09% in the last year.
- The Revenue has been growing slightly by 3.79% on average over the past years.
EPS 1Y (TTM)9.58%
EPS 3Y-5.83%
EPS 5Y5.75%
EPS Q2Q%22.93%
Revenue 1Y (TTM)12.09%
Revenue growth 3Y6.31%
Revenue growth 5Y3.79%
Sales Q2Q%14.98%
3.2 Future
- Based on estimates for the next years, BNS will show a small growth in Earnings Per Share. The EPS will grow by 7.07% on average per year.
- BNS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.90% yearly.
EPS Next Y14.63%
EPS Next 2Y13.4%
EPS Next 3Y12.97%
EPS Next 5Y7.07%
Revenue Next Year5.18%
Revenue Next 2Y5.09%
Revenue Next 3Y4.56%
Revenue Next 5Y3.9%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 14.48 indicates a correct valuation of BNS.
- 70.83% of the companies in the same industry are cheaper than BNS, based on the Price/Earnings ratio.
- BNS's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.21.
- With a Price/Forward Earnings ratio of 12.63, BNS is valued correctly.
- 70.83% of the companies in the same industry are cheaper than BNS, based on the Price/Forward Earnings ratio.
- BNS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.48 | ||
| Fwd PE | 12.63 |
4.2 Price Multiples
- BNS's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. BNS is more expensive than 70.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.08 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- BNS's earnings are expected to grow with 12.97% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.99
PEG (5Y)2.52
EPS Next 2Y13.4%
EPS Next 3Y12.97%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 4.29%, BNS is a good candidate for dividend investing.
- BNS's Dividend Yield is rather good when compared to the industry average which is at 3.11. BNS pays more dividend than 87.50% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.81, BNS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.29% |
5.2 History
- The dividend of BNS has a limited annual growth rate of 4.75%.
- BNS has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.75%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- BNS pays out 80.91% of its income as dividend. This is not a sustainable payout ratio.
- BNS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP80.91%
EPS Next 2Y13.4%
EPS Next 3Y12.97%
BANK OF NOVA SCOTIA / BNS.CA FAQ
What is the fundamental rating for BNS stock?
ChartMill assigns a fundamental rating of 3 / 10 to BNS.CA.
Can you provide the valuation status for BANK OF NOVA SCOTIA?
ChartMill assigns a valuation rating of 3 / 10 to BANK OF NOVA SCOTIA (BNS.CA). This can be considered as Overvalued.
How profitable is BANK OF NOVA SCOTIA (BNS.CA) stock?
BANK OF NOVA SCOTIA (BNS.CA) has a profitability rating of 2 / 10.
What are the PE and PB ratios of BANK OF NOVA SCOTIA (BNS.CA) stock?
The Price/Earnings (PE) ratio for BANK OF NOVA SCOTIA (BNS.CA) is 14.48 and the Price/Book (PB) ratio is 1.46.
Can you provide the dividend sustainability for BNS stock?
The dividend rating of BANK OF NOVA SCOTIA (BNS.CA) is 7 / 10 and the dividend payout ratio is 80.91%.