Scotiabank Stock Rose 5.6% in November: Is it a Buy Today?

Scotiabank (TSX:BNS) stock had a strong performance in November. Investors should look to buy this bank stock after earnings.

| More on:
sad concerned deep in thought

Image source: Getty Images

Scotiabank (TSX:BNS) is the fourth largest of the Big Six Canadian bank stocks. It is often called “The International Bank” due to its significant global reach. Today, I want to look at how Scotiabank has performed in recent weeks. Moreover, we’ll determine whether this bank stock is worth snatching up in early December. Let’s jump in.

How has this top bank stock performed in 2022?

Shares of Scotiabank climbed 5.6% in the month of November. However, this bank is still down 24% in the year-to-date period as of mid-morning trading on December 5. This bank stock has struggled mightily since hitting a 52-week high in the month of March. Its peers in the banking space have also faced challenges in the face of economic turbulence and the most aggressive interest rate hikes from the Bank of Canada in over a decade. Foolish readers can peruse the interactive chart below.

Should investors be optimistic about this bank stock as we look ahead to the new year? Let’s dive into its last batch of fiscal 2022 results.

Should you be encouraged by Scotiabank’s last batch of earnings?

Scotiabank unveiled its fourth-quarter (Q4) and full-year fiscal 2022 earnings on November 29. In Q4 2022, the bank posted adjusted net income of $2.61 billion, or $2.06 per share — down from $2.71 billion, or $2.10 per share, in the previous year. This slowdown to close out the year may indicate rough waters for Scotiabank and its peers as we look ahead to 2023.

For the full year, the bank delivered adjusted net income of $10.7 billion, or $8.50 per diluted share. That was up from $10.1 billion, or $7.87 per diluted share, for the full year in fiscal 2021. Its Canadian Banking segment posted adjusted earnings growth of 15% to $4.77 billion. This segment was powered by strong residential mortgage and business banking loan growth. Meanwhile, its International Banking segment delivered adjusted earnings of $2.44 billion — up 32% from the prior year.

Overall, Scotiabank was able to shoot over its medium-term profitability targets on an adjusted basis. Management remains confident in its long-term prospects. However, it faces significant headwinds along with its peers in the form of significant interest rate tightening and the rising possibility of a global recession.

Scotiabank: Is this bank stock worth buying right now?

This bank stock currently possesses a very favourable price-to-earnings ratio of 8.5. That puts Scotiabank in more attractive value territory compared to its industry peers. Investors on the hunt for value should strongly consider snatching up this top bank stock on the dip. Scotiabank last announced a quarterly dividend of $1.03 per share. That represents a tasty 6% yield.

I’m looking to snatch up Scotiabank for its nice value and the very strong dividend it offers in late 2022. Moreover, this bank gives investors exposure to great global diversification.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool recommends Bank Of Nova Scotia. The Motley Fool has a disclosure policy.

More on Bank Stocks

stock research, analyze data
Bank Stocks

Better Buy: TD Stock or Bank of Nova Scotia?

TD Bank and Bank of Nova Scotia still look cheap. Is one a good buy today?

Read more »

edit Four girl friends withdrawing money from credit card at ATM
Bank Stocks

2 Top TSX Bank Stocks to Buy in February 2023

Here's why Toronto-Dominion Bank (TSX:TD) and Bank of Nova Scotia (TSX:BNS) are two top TSX bank stocks to consider right…

Read more »

grow money, wealth build
Bank Stocks

TFSA Investors: A Big Bank Stock That Pays Almost 6% in Dividend Income

A Big Bank stock is an ideal core holding in a TFSA, not only for its financial stability but also…

Read more »

Target. Stand out from the crowd
Bank Stocks

BMO Stock looks Better Than its Peers in January 2023

What's next for BMO stock after a downfall in 2022?

Read more »

Bank sign on traditional europe building facade
Bank Stocks

As Banks Expand South of the Border, Which Is the Better Bet for Growth?

Canada’s big banks are expanding into the U.S. market. Here’s a look at which of these titans is a better…

Read more »

Young woman sat at laptop by a window
Bank Stocks

Could BMO Stock Be a Big Winner in 2023?

Long-term investors should take a closer look at BMO stock as a potential core holding, especially on dips.

Read more »

IMAGE OF A NOTEBOOK WITH TFSA WRITTEN ON IT
Tech Stocks

TFSA Passive Income: How I’m Investing to Make $2,000/Year From Dividends

I am increasing my dividend income by investing in dividend stocks like the Toronto-Dominion Bank.

Read more »

Make a choice, path to success, sign
Bank Stocks

Of the Big 6 Bank Stocks: Buy This, Not That

CIBC (TSX:CM) is an interesting Big Six bank stock to buy right now.

Read more »