Wealth Professional wrote about the Canadian banks and why we believe there’s still room in this recovery for banks to make above-average returns. Click here to read the article.
Canadian Banks
Financial Post Opinion: Canadian bank dividends are poised to rise — a lot
The Financial Post published our comment on why we believe Canadian bank dividends, in our view, are poised to rise meaningfully over the next few quarters. Click here to read the full article in the Financial Post.
BNN Bloomberg: Canadian bank dividends could rise 25 per cent over the next four quarters
Rob Wessel was on BNN Bloomberg today to discuss our expectations for Canadian bank dividend increases and the performance of our Hamilton Enhanced Canadian Bank ETF (HCAL), which ended its first year as the top performing Canadian bank ETF. Please click here to watch the interview.
Canadian Banks: How High Can Dividends Go? (and HCAL Outperforms)
Canadian bank dividends, in our view, are poised to rise – a lot. In August, before Q3 earnings season, we argued there was no policy rationale for the continuing moratorium on dividend increases (see “Canadian Banks: Why OSFI Should Lift its Dividend Cap Now”). At the time, earnings and capital were already at all time highs. Moreover, the banks had set aside an enormous ~$21.4 bln…
Canadian Banks: Record Earnings/Capital; Still in Catalyst #2 (Q3 2021 in Charts)
Q3 earnings trends for the Canadian banks were again strong with record earnings and capital levels, while the ‘three catalyst’ investment thesis – normalization of profits, reserve releases and higher margins – we laid out for the sector in February continues to play out almost exactly as predicted[1]. We believe the banks are still supported by Catalyst #2. Before we discuss Canadian bank results in more…
Financial Post Opinion: Canada’s big banks are stronger than ever, and should be allowed to raise dividends
The Financial Post published our comment on why we believe OSFI should allow dividend increases now as there are no policy reasons to support the ongoing moratorium. Click here to read the full article in the Financial Post.
BNN Bloomberg: Canadian banks earnings season and No-Fee Trading
Rob Wessel was on BNN Bloomberg today to discuss the upcoming Canadian banks earnings season and no-fee trading, as well as the Hamilton Enhanced Multi-Sector Covered Call ETF (HDIV), that launched in July 2021. Click here to watch the interview.
Canadian Banks: Why OSFI Should Lift its Dividend Cap Now
Before we discuss why the Canadian regulator OSFI should lift its cap on dividends as soon as possible, we would like to highlight the recent launch of the Hamilton Enhanced Multi-Sector Covered Call ETF (ticker: HDIV), an equal weight portfolio of seven established covered call ETFs with a sector mix broadly consistent with that of the S&P/TSX 60. HDIV utilizes modest 25% cash leverage to support…
Canadian Banks: Reserve Releases Dominate Results; Q2-21 Takeaways (in Charts)
Reserve releases featured prominently in Q2 earnings results for the Canadian banks, another step forward for the sector in its ongoing credit recovery and just one of the positive catalysts we previously identified for Canadian bank stocks in 2021. In our October webcast, “Canadian Banks: Credit Cycle is (Basically) Over”[1], we outlined our reasoning that a credit-driven recovery in Canadian bank earnings and stocks was beginning.…
Canadian Banks: Catalyst #2 (Reserve Releases) Approaching
In this Insight, we explain why we believe reserve releases of between $6 and $8 bln for the Canadian banks are coming in 2021, which could have a material impact on share prices. While all credit cycles are unique, they each have distinct stages and this COVID credit cycle has been no different. The first stage was three quarters in duration (Q2-20 to Q4-20) and characterized…
HCAL/HCA: Volatility vs. Individual Cdn Banks
In this One Chart, we compare the volatility profile of 1.25x the Solactive Canadian Bank Mean Reversion index (SOLCBMRT) – which the Hamilton Enhanced Canadian Bank ETF (ticker, HCAL) seeks to replicate before fees – to that of the Big-6 Canadian banks. We believe HCAL is a good choice for long-term investors, as its modest leverage offers the potential for higher returns in a steadily growing…
Canadian Banks: Are Analysts Underestimating the Recovery (Again)?
In our October webcast, “Canadian Banks – Credit Cycle is (Basically) Over”, we correctly predicted that reserve builds for the Canadian banks would peak in Q4-20, and that the recovery would begin in Q1-21. In fact, we launched the Hamilton Enhanced Canadian Bank ETF (HCAL)[1] in October 2020 to give investors a vehicle to capitalize more fully on this recovery while at the same time benefiting…