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Bank of Nova Scotia (BNS) Gains As Market Dips: What You Should Know

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Bank of Nova Scotia (BNS) closed the most recent trading day at $63.39, moving +1.02% from the previous trading session. This change outpaced the S&P 500's 0.4% loss on the day. At the same time, the Dow added 0.08%, and the tech-heavy Nasdaq lost 0.19%.

Coming into today, shares of the bank had lost 7.05% in the past month. In that same time, the Finance sector lost 9.6%, while the S&P 500 lost 9.39%.

Bank of Nova Scotia will be looking to display strength as it nears its next earnings release, which is expected to be May 25, 2022. In that report, analysts expect Bank of Nova Scotia to post earnings of $1.61 per share. This would mark year-over-year growth of 7.33%. Meanwhile, our latest consensus estimate is calling for revenue of $6.23 billion, up 1.94% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.64 per share and revenue of $25.67 billion. These totals would mark changes of +6.24% and +3.51%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Bank of Nova Scotia. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Bank of Nova Scotia is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Bank of Nova Scotia has a Forward P/E ratio of 9.45 right now. Its industry sports an average Forward P/E of 9, so we one might conclude that Bank of Nova Scotia is trading at a premium comparatively.

It is also worth noting that BNS currently has a PEG ratio of 1.45. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. BNS's industry had an average PEG ratio of 0.71 as of yesterday's close.

The Banks - Foreign industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 147, which puts it in the bottom 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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