National Bank (TSX:NA) is the sixth largest of the Big Six Canadian banks. That should not fool investors. This bank is still a behemoth in its home province of Quebec. Today, I want to explore why National Bank often flies under-the-radar and why the bank stock looks undervalued ahead of its next batch of earnings. Shares of this bank stock have jumped 4.7% month-over-month as of early morning trading on Monday, July 31. The stock is up 12% so far in 2023.
This bank is set to release its third batch of fiscal 2023 earnings on August 30. In the first quarter (Q1) of 2023, National Bank reported adjusted net income of $847 million or $2.38 per diluted share – down from $889 million or $2.53 per diluted share.
National Bank’s Personal and Commercial Banking segment achieved net income growth of 14% to $335 million. Meanwhile, its Wealth Management segment posted net income growth of 9% to $178 million. Net income in its Financial Markets segment fell 7% year-over-year to $268 million and its U.S. Specialty Finance reported net income of $128 million.
Shares of this bank stock currently possess a favourable price-to-earnings ratio of 11. That puts National Bank in more favourable value than most of its industry peers. National Bank last paid out a quarterly dividend of $1.02 per share. That represents a 3.9% yield. I’m looking to snatch up this undervalued bank in the middle of the summer season.
