It’s almost the end of August, and that means it’s almost time for bank earnings. Bank stocks have taken a beaten during the market crash. Many economists predicted the downturn, but it look like these stocks have slowly but surely been coming back. Many are almost at pre-crash prices.
But there are quite a few bank stocks out there, each with different reasons for your consideration. You might be thinking, why buy now when we still have a week and a half before earnings? The answer is that the closer we get to earnings, the higher these stocks could go. If you’re looking for the perfect buy and hold opportunity, and to bring in as much quick cash as possible, now is the best time before earnings come in.
One of my top choices for bank stocks has to be Toronto-Dominion Bank (TSX:TD)(NYSE:TD). Of the Big Six Banks, TD has the best growth opportunity for investors. The bank has already expanded into the United States, where it is now one of the top 10 banks in the country. It has also expanded into wealth and commercial management, which continues to bring in solid cash.
Shares in TD are still well below where they should be. After falling about 36% from the crash, the stock is back up 28% as of writing. It still has 22% to go to reach pre-crash prices. But over the long term, this stock should explode as it continues to expand.
It’s already one of the largest banks in Canada by market capitalization, and could soon take the top spot. So if you’re looking for a growth bank stock, you have to go with TD.
The other largest bank by market capitalization? Royal Bank of Canada (TSX:RY)(NYSE:RY). The reason I would choose Royal Bank is if you’re looking for a completely stable, predictable, solid stock. Royal Bank has it down when it comes to investing and expanding. It’s even started to expand into Latin America for some emerging market growth.
Royal Bank fell about 41% from peak to trough, and is now up 26% as of writing with 13% to go to reach fair value prices. What’s great about Royal Bank is that you’ll receive peace of mind. The stock came out of the last recession fairly solid, and steadily climbed from there. You should continue seeing it climb for decades, with a solid 4.41% dividend yield to go along with it.
Finally, Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM) is perfect if you’re looking for passive income. This bank stock might be one of the weaker ones when it comes to expansion, investing heavily in the Canadian market. But its dividend remains strong. For those looking to bring in extra cash, you simply have to go with CIBC.
The bank has the highest dividend of the Big Six Banks at $5.84 per share, or a 5.98% dividend yield as of writing. Shares also fell about 40%, and have climbed up 44% in that time, with about 20% left to go to hit pre-crash levels.
Meanwhile, its dividend has actually increased during the pandemic. For looking for some cash to have on hand with finances strapped, you have to go with CIBC.
There are plenty of solid options for quick growth right now, but bank stocks are ideal for those looking to create income now and in the future. Each of these stocks has a solid history of long-term growth, and each also offers strong dividends to boot.
If you want to bring in cash now, invest in bank stocks. If you want steady, predictable growth, invest in bank stocks. Doing it now means you’ll just beat the pre-earnings rush.
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Fool contributor Amy Legate-Wolfe owns shares of ROYAL BANK OF CANADA and TORONTO-DOMINION BANK.