Despite the stellar performance of the market so far this year, most investors would agree that there’s a certain element of volatility just over the horizon. Apart from the push into precious metals that this is causing, it is also drawing some investors to stocks that they can buy now for stability and growth.
Canada’s big bank stocks represent great examples of those stocks to buy now for stability and growth. Here are two of those big bank stocks that you should consider adding to your portfolio today.
Source: Getty Images
Have you considered Bank of Nova Scotia?
Bank of Nova Scotia (TSX:BNS) isn’t the largest of the big banks, but it does offer investors something really unique that its peers lack. That extra something is a laser-like focus on international expansion.
In recent years, Scotiabank has targeted developing Latin American markets with their higher growth potential to fuel that growth. Unfortunately, those markets, while higher growth, are also higher risk. This has ultimately led to Scotiabank refocusing itself on more mature North American markets.
That shift has provided investors with an opportunity to pick up shares of Scotiabank while there’s still room to grow.
Speaking of growth, the bank reported results for the third fiscal quarter last week. In that quarter, Scotiabank reported net income of $2.5 billion, reflecting an increase of $615 million over the same period last year.
On a per share basis, that worked out to $1.84 per diluted share, compared to $1.41 per diluted share reported last year. Both Scotiabank’s domestic and international segments posted strong gains in the quarter, reporting adjusted earnings of $959 million and $716 million, respectively.
Those impressive results allow Scotiabank to continue investing in growth while paying a very juicy quarterly dividend. In fact, Scotiabank has been paying out that dividend for nearly two centuries without fail. The bank also has an established cadence of providing annual upticks to that dividend.
As of the time of writing, Scotiabank pays out a very handsome 5% yield. This makes Scotiabank a top pick for those investors seeking stocks to buy now for stability and growth.
Another great big bank stock to buy
Another one of the top options in the big bank space for investors seeking stocks to buy now for stability and growth is TD Bank (TSX:TD). TD is the second-largest of Canada’s big banks and, like Scotiabank, boasts a strong domestic arm and a growth-focused international segment.
One key difference is TD’s international segment, which is focused solely on the U.S. market. In fact, TD’s presence in the U.S. has grown significantly over the past two decades. The bank currently boasts over 1,100 branches across 16 states stretching from Maine to Florida.
TD’s growth-focused presence is offset by its stable operations at home in Canada. In the most recent quarter, the bank reported earnings of $3.3 billion, compared with a $181 million loss reported last year.
TD’s Canadian banking unit posted a record $2 billion in earnings for the quarter, reflecting a 4% year-over-year improvement. That domestic arm generates the bulk of the bank’s revenue, leaving ample room for growth and to pay its generous quarterly dividend.
As of the time of writing, that dividend pays out a respectable 4.1%. And like Scotiabank, TD has been paying that dividend for over a century and provided annual upticks to it for years.
Taking into consideration TD’s growth-focused agenda and stellar results, it’s hard not to see TD as a superb long-term pick for investors searching for stocks to buy now for stability and growth.
Stocks to buy now for stability and growth
Both TD and Scotiabank can provide growth and income-earning potential for any portfolio. In addition to the juicy yield on offer, both banks offer defensive appeal and growth potential, making them top options for investors.
In my opinion, one or both should be core positions in any well-diversified portfolio.
Buy them, hold them, and watch your income grow.
