LSE:0UKI

Stock Analysis Report

Bank of Nova Scotia

Executive Summary

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally.


Snowflake Analysis

Flawless balance sheet average dividend payer.


Similar Companies

Share Price & News

How has Bank of Nova Scotia's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 0UKI's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

68.9%

0UKI

-14.6%

GB Banks

-2.4%

GB Market


1 Year Return

12.9%

0UKI

-45.3%

GB Banks

-25.9%

GB Market

Return vs Industry: 0UKI exceeded the UK Banks industry which returned -45.3% over the past year.

Return vs Market: 0UKI exceeded the UK Market which returned -25.9% over the past year.


Shareholder returns

0UKIIndustryMarket
7 Day68.9%-14.6%-2.4%
30 Day17.7%-27.6%-18.0%
90 Day9.2%-43.7%-29.1%
1 Year19.1%12.9%-43.3%-45.3%-22.2%-25.9%
3 Yearn/a-42.8%-49.0%-16.0%-26.6%
5 Yearn/a-43.0%-53.2%-4.5%-26.1%

Price Volatility Vs. Market

How volatile is Bank of Nova Scotia's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Bank of Nova Scotia undervalued compared to its fair value and its price relative to the market?

46.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 0UKI (CA$80.31) is trading below our estimate of fair value (CA$150.32)

Significantly Below Fair Value: 0UKI is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 0UKI is poor value based on its PE Ratio (8x) compared to the Banks industry average (5x).

PE vs Market: 0UKI is good value based on its PE Ratio (8x) compared to the UK market (12.3x).


Price to Earnings Growth Ratio

PEG Ratio: 0UKI's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: 0UKI is overvalued based on its PB Ratio (1x) compared to the GB Banks industry average (0.5x).


Next Steps

Future Growth

How is Bank of Nova Scotia forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

-1.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 0UKI's earnings are forecast to decline over the next 3 years (-1% per year).

Earnings vs Market: 0UKI's earnings are forecast to decline over the next 3 years (-1% per year).

High Growth Earnings: 0UKI's earnings are forecast to decline over the next 3 years.

Revenue vs Market: 0UKI's revenue (5% per year) is forecast to grow faster than the UK market (2.6% per year).

High Growth Revenue: 0UKI's revenue (5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if 0UKI's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Bank of Nova Scotia performed over the past 5 years?

5.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 0UKI has high quality earnings.

Growing Profit Margin: 0UKI's current net profit margins (29.5%) are lower than last year (31%).


Past Earnings Growth Analysis

Earnings Trend: 0UKI's earnings have grown by 5.2% per year over the past 5 years.

Accelerating Growth: 0UKI's earnings growth over the past year (1.8%) is below its 5-year average (5.2% per year).

Earnings vs Industry: 0UKI earnings growth over the past year (1.8%) underperformed the Banks industry 26.6%.


Return on Equity

High ROE: 0UKI's Return on Equity (12.7%) is considered low.


Next Steps

Financial Health

How is Bank of Nova Scotia's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: 0UKI has a low level of unsold assets or inventory.

Debt Coverage by Assets: 0UKI's debt is covered by short term assets (assets are 2.2x debt).


Financial Institutions Analysis

Asset Level: 0UKI's level of assets compared to its equity is moderate.

Allowance for Bad Loans: 0UKI has a sufficient allowance for bad loans.

Low Risk Liabilities: 0UKI's liabilities are made up of primarily low risk sources of funding.

Loan Level: 0UKI has an acceptable proportion of non-loan assets held.

Low Risk Deposits: 0UKI's loans are broadly funded by customer deposits.

Level of Bad Loans: 0UKI has an appropriate level of bad loans (0.8%)


Next Steps

Dividend

What is Bank of Nova Scotia's current dividend yield, its reliability and sustainability?

6.59%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 0UKI's dividend (6.59%) is higher than the bottom 25% of dividend payers in the UK market (2.66%).

High Dividend: 0UKI's dividend (6.59%) is low compared to the top 25% of dividend payers in the UK market (7.4%).


Stability and Growth of Payments

Stable Dividend: 0UKI's dividends per share have been stable in the past 10 years.

Growing Dividend: 0UKI's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (51.6%), 0UKI's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.9yrs

Average management tenure


CEO

Brian Porter (61yo)

6.42s

Tenure

CA$12,633,496

Compensation

Mr. Brian Johnston Porter serves as President and Chief Executive Officer of Bank of Nova Scotia (the “Bank”). He joined bank in 1981. He served as the Bank’s Chief Risk Officer from 2005 to 2008, as Group ...


CEO Compensation Analysis

Compensation vs Market: Brian's total compensation ($USD8.94M) is above average for companies of similar size in the UK market ($USD5.59M).

Compensation vs Earnings: Brian's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Brian Porter
President6.42yrsCA$12.63m0.011% CA$7.4m
Rajagopal Viswanathan
Group Head & CFO1.92yrsCA$3.25m0.0012% CA$793.9k
James O'Sullivan
Strategic Advisor to the CEO6.42yrsCA$7.19m0.0049% CA$3.2m
Ignacio Deschamps
Group Head of International Banking & Digital Transformation4.17yrsCA$5.97m0.00017% CA$112.5k
Daniel Rees
Group Head of Canadian Banking0.83yrCA$3.85m0.0012% CA$774.0k
Adrián Otero Rosiles
Executive VP & Country Head of Scotiabank Mexico0.83yrCA$5.02mno data
Tracy Bryan
Executive Vice President of Global Operations0.83yrno datano data
James Neate
Co-Group Head of Global Banking & Mkts and Head of Global Corp & Investment Bankingno datano data0.00056% CA$370.5k
Michael Zerbs
Group Head of Technology & Operations3.17yrsno data0.000040% CA$26.5k
Philip Stephen Smith
Senior Vice President of Investor Relations1.67yrsno datano data

1.9yrs

Average Tenure

Experienced Management: 0UKI's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Brian Porter
President6.42yrsCA$12.63m0.011% CA$7.4m
Susan Segal
Independent Director8.33yrsCA$434.74k0.00015% CA$99.2k
Una Power
Independent Director4yrsCA$285.00k0.00048% CA$317.5k
Aaron Regent
Independent Chairman of the Board1yrCA$373.19k0.0052% CA$3.4m
Indira Samarasekera
Independent Director11.92yrsCA$235.00k0.00016% CA$105.8k
Tiff Macklem
Independent Director4.83yrsCA$459.38k0.00011% CA$72.8k
L. Thomson
Independent Director4yrsCA$263.06k0.00067% CA$443.2k
Charles Dallara
Independent Director6.58yrsCA$393.04k0.00012% CA$79.4k
Guillermo Babatz
Independent Director6.25yrsCA$416.42k0.00021% CA$138.9k
Nora Aufreiter
Independent Director5.67yrsCA$244.64k0.00026% CA$172.0k

6.0yrs

Average Tenure

58.5yo

Average Age

Experienced Board: 0UKI's board of directors are considered experienced (6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 0UKI insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

The Bank of Nova Scotia's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Bank of Nova Scotia
  • Ticker: 0UKI
  • Exchange: LSE
  • Founded: 1832
  • Industry: Diversified Banks
  • Sector: Banks
  • Market Cap: CA$66.156b
  • Shares outstanding: 1.21b
  • Website: https://www.scotiabank.com

Number of Employees


Location

  • The Bank of Nova Scotia
  • Scotia Plaza
  • 44 King Street West
  • Toronto
  • Ontario
  • M5H 1H1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BNSNYSE (New York Stock Exchange)YesCommon SharesUSUSDDec 1972
BNSTSX (The Toronto Stock Exchange)YesCommon SharesCACADDec 1972
0UKILSE (London Stock Exchange)YesCommon SharesGBCADDec 1972
BNS *BMV (Bolsa Mexicana de Valores)YesCommon SharesMXMXNDec 1972
BKNDB (Deutsche Boerse AG)YesCommon SharesDEEURDec 1972
BNS.PRDTSX (The Toronto Stock Exchange)PFD SER 31 FLTCACADApr 2015
BNS.PRGTSX (The Toronto Stock Exchange)PFD SER 36CACADMar 2016
BNS.PRHTSX (The Toronto Stock Exchange)NON CUM 5 PFD 38CACADSep 2016
BNS.PRITSX (The Toronto Stock Exchange)NON CUM PFD 40CACADOct 2018

Biography

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally. It operates through Canadian Banking, International Banking, Global Banking and Markets, and Global Wealth Management segments. The company offers financial advice and solutions, and day-to-day banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and insurance to individuals; and business banking solutions comprising lending, deposit, cash management, and trade finance solutions to small businesses and commercial customers, including automotive financing solutions to dealers and their customers. It is also involved in the provision of wealth management advice and solutions, including online brokerage, mobile investment, full-service brokerage, trust, private banking, and private investment counsel services; and retail mutual funds, exchange traded funds, liquid alternative funds, and institutional funds. In addition, the company offers international banking services for retail, corporate, and commercial customers; and lending and transaction, investment banking advisory, and capital markets access services to corporate customers. Further, it provides Internet, mobile, and telephone banking services. The company operates a network of 950 branches and approximately 3,650 automated banking machines in Canada; and approximately 1,900 branches and 5,500 ATMs internationally, as well as contact centers. The Bank of Nova Scotia was founded in 1832 and is headquartered in Toronto, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/06 20:38
End of Day Share Price2020/04/02 00:00
Earnings2020/01/31
Annual Earnings2019/10/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.