On shakier ground: Veritas slashes Big Six banks' price targets
Veritas Investment Research financial services analyst Nigel D’Souza pointed to a recent sharp sell-off among Canada’s biggest banks and cautioned that there was further downside risk in the sector. The firm expects provisions for credit losses, or the amount of capital set aside for bad loans, over 2024 to run higher than pre-pandemic levels, assuming central banks don’t opt for a dovish pivot in their rate hikes.
While D’Souza upgraded the Bank of Nova Scotia to a “Buy,” the firm lowered its price target to $72 from $80. The change largely stems from softer growth in the bank’s Latin American businesses and rising credit losses heading into a recessionary environment. D’Souza noted that the unexpected shift in leadership that will see Brian Porter retiring in January raises some uncertainty, but the current share price would give investors an “attractive risk-reward skew.
of Tennessee-based regional bank First Horizon Corp. is expected to close early next year, bringing some earnings upside.Article content
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