When market seas get rough, there’s a calm area where many Canadians can take safe harbour. That port is in Canadian banks, and none are safer than Royal Bank of Canada (TSX: RY). It’s not just Canada’s largest bank, but Canada’s largest stock by market capitalization. And the company looks as though it has no plans of slowing down.
So today, let’s look into why RBC looks like a strong option on the TSX today, and why it could be the safest long-term bet.
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Into earnings
First, let’s look at the bank’s most recent third-quarter report for 2025. The company reported financial results that were compelling for any investor, especially new investors considering the bank stock for long-term potential.
RBC reported record net income of $5.4 billion for the third quarter. This marked a 21% increase compared to the same time last year. Furthermore, it also reported adjusted net income of $5.5 billion, with substantial growth driven by incredible performances across its business segments. And, as usual, this was especially true for its capital markets, as well as personal and commercial banking segments.
Diluted earnings per share (EPS) were also a strong point, increasing a whopping 21% to $3.75. Adjusted diluted EPS was even better, up 18% to $3.84. The bank stock also reported a return on equity (ROE) that went up 180 basis points, up 17.3%, showing the bank stock continues to use its capital effectively to achieve profitability.
More to come
RBC continues to prove why it’s a solid investment over and over again, and it doesn’t look as though it’s about to slow down. In fact, the bank stock held its common equity tier 1 (CET1) ratio at 13.2%, demonstrating it holds a robust capital position. One that supports further growth, along with shareholder returns, dividends, and buybacks.
Growth looks likely, given the bank stock reported revenue that came in at $17 billion for the quarter, a seriously high increase from last year. RBC’s long-term client relationships, innovative technology investments, and continued acquisitions are all key drivers to further success.
Yet if you’re impatient, the bank stock also provides a solid dividend, currently yielding 3.1% at the time of writing. Plus, RBC recently increased the dividend thanks to its solid financial health. And with a payout ratio at just 44.8%, it’s clear the bank stock is balancing growth while also increasing dividends. In fact, if investors were to put $7,000 into the bank stock, investors could receive annual income of $209!
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| RY | $200.10 | 34 | $6.16 | $209.44 | Quarterly | $6,803.40 |
Bottom line
Overall, RBC stock is a strong investment that’s only getting stronger. With a market cap of $282.4 billion at writing, it’s one of the largest financial institutions not just in Canada, but around the world. With even more growth on the horizon, a higher dividend, and a history of robust earnings, this bank stock is one every Canadian investor should consider.
