NA.TO (National Bank of Canada) is down roughly 4–5%+ intraday on August 26, 2026 (trading in the low $210s after a prior close near $222.53), despite beating Q3 earnings estimates.
Key Q3 results (ended July 31, 2026)
- Net income: $1.307 billion (+23% YoY); diluted EPS $3.25 (+26%).
- Adjusted net income: $1.362 billion; adjusted diluted EPS $3.39 (beat consensus of ~$3.16–$3.22).
- Revenue: $4.05 billion (+18% YoY; beat estimates of ~$3.87 billion).
- Strong segment growth: Capital markets net income +32% to $442 million; wealth management +21% to $296 million; personal & commercial +14% to ~$370–421 million.
- Dividend declared at $1.32 per share (unchanged).
Why the drop?
Investors are focusing on higher provisions for credit losses (PCLs) of $246 million (vs. $203 million a year earlier and slightly above some analyst expectations around $237 million). This comes amid ongoing US-Canada trade tensions/tariffs and broader geopolitical uncertainty, even as the bank described credit performance as resilient overall and noted positive operating leverage.
The stock had already pulled back in recent sessions from highs near $237 earlier in the summer. Broader TSX pressure (index opened slightly lower) from trade-war concerns also weighed on financials. Canadian bank stocks had run up strongly YTD on expectations of solid profits, so any PCL uptick or caution can trigger profit-taking after a beat.
Bottom line: Solid operational beat driven by capital markets and wealth, but elevated PCLs and macro trade risks are driving the sell-off. Watch the earnings call and peer results (RY, TD, CM reporting soon) for more color on credit outlook.
Leave a Reply
You must be logged in to post a comment.