One of the most dominant Canadian banks, Toronto-Dominion Bank (TSX:TD)(NYSE:TD) has remained a top pick of mine for a long time, for various reasons.
In this article, I’m going to discuss why I think this Canadian lender’s dividend is particularly attractive in the context of its peers and the broader Canadian economy. And I’ll discuss the key drivers of its dividend I see as outperforming over the long haul.
TD’s yield is middle of the pack when compared to its peers and has generally been on the lower end when one compares the yields of all Canadian publicly-listed financials players. This is mainly due to the quality of TD’s assets, and the higher growth rate many analysts and investors ascribe to TD’s business model.
The Canadian lender has a dominant position in Canadian personal and corporate banking and has significantly grown its market share in U.S. retail banking, a key growth driver many investors like.
TD has grown its international footprint in large part due to well-timed acquisitions of unloved retail banking assets in the years following the 2008 financial crisis.
Other peers have tried to replicate this success, but most paid too much for the assets purchased, unlike TD. The ability to grow its revenue and earnings via acquisition has propelled TD higher over the past decade than most of its peers on a percentage basis, allowing for dividend growth and balance sheet strength which should prevent against any negative dividend maneuvers in the future.
Invest wisely, my friends.
