The National Bank of Canada (OTCMKTS: NTIOF) has had its second-quarter earnings per share (EPS) forecast lowered by Desjardins, according to a research note issued on Wednesday. Analyst D. Young revised the estimated Q2 2025 EPS downward from $1.87 to $1.67. The consensus projection for the full-year 2025 EPS is now at $7.63 per share, reflecting the ongoing economic and market volatility affecting financial institutions.
Analysts Adjust Earnings Expectations
Desjardins’ latest revision also impacted projections for the bank’s upcoming quarters and fiscal years. The new estimates suggest Q3 2025 earnings of $1.82 per share and Q4 2025 earnings of $1.98 per share. The full-year 2025 EPS has been adjusted to $7.53, with a forecast of $8.12 per share for the fiscal year 2026. These adjustments indicate cautious optimism regarding the bank’s long-term performance despite short-term uncertainties.
Recent Performance and Financial Stability
The National Bank of Canada last reported its quarterly earnings on December 4, 2024. The financial services provider exceeded expectations, posting an EPS of $1.89, surpassing the consensus estimate of $1.84 by $0.05. The bank demonstrated strong financial health, reporting a net margin of 24.65% and a return on equity (ROE) of 17.21%, reinforcing investor confidence in its stability.
Market Reaction and Stock Performance
Following the earnings forecast revision, the stock has shown resilience. As of Friday, the National Bank of Canada’s stock price stood at $83.17, marking a 0.3% increase. The stock’s 12-month range has fluctuated between a low of $76.77 and a high of $100.08. The company’s 50-day simple moving average is currently $89.68, while the 200-day simple moving average sits at $92.37. These indicators suggest a cautious yet steady trajectory for the stock despite fluctuations.
Industry-Wide Analyst Ratings
The National Bank of Canada has also seen its stock rating revised by multiple equity research firms. CIBC World Markets downgraded the stock from a “strong-buy” rating to a “hold” on February 18, 2025. Similarly, Barclays issued a downgrade on November 21, 2024, moving the stock from a “strong-buy” to a “hold.” Cormark followed suit on February 21, 2025, adjusting its rating from a “moderate buy” to a “hold.” These changes indicate a more cautious outlook from analysts amid macroeconomic challenges affecting the financial sector.
Dividend Policy and Shareholder Returns
Despite earnings forecast adjustments, the National Bank of Canada recently increased its dividend payout. A dividend of $0.8104 per share was paid on February 1, 2025, to shareholders who were on record as of December 31, 2024. This represents a slight increase from the previous dividend of $0.81 per share, offering a yield of 3.53%. The bank’s current payout ratio stands at 41.02%, demonstrating its commitment to maintaining steady shareholder returns.
Company Overview and Future Outlook
The National Bank of Canada provides financial services to individuals, businesses, institutional clients, and government entities across Canada and internationally. Operating through four key segments—Personal and Commercial, Wealth Management, Financial Markets, and U.S. Specialty Finance and International—the bank offers a diverse range of financial products and solutions. These include mortgage loans, credit solutions, investment products, and insurance services.
Looking ahead, the bank’s performance will likely be influenced by economic conditions, interest rate changes, and market trends. Investors and analysts will closely monitor future earnings reports and any strategic initiatives the bank undertakes to sustain growth.
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