01:02 PM EDT, 09/30/2025 (MT Newswires) -- The Toronto-Dominion Bank ( MLWIQXX ) investor day highlighted a significant shift to efficiency and capital return, notes RBC. TD announced a $6 billion to $7 billion incremental normal course issuer bid (NCIB) program when its current active NCIB is completed for a total estimated share buyback of $8 billion in FY26, which RBC views positively.

"Over and above capital return we sensed a far bigger emphasis on cost control/efficiency," writes analyst Darko Mihelic. TD outlined that it is anticipating ~$900 million of targeted annual run-rate cost savings in 2026 (including ~$500 million in remaining run-rate cost savings from its FY25 restructuring program) and was seeking another ~$1.1 billion in annual run-rate cost savings during 2027 and 2028.

Some of the 2026 targets suggest RBC estimates may be conservative, Mihelic adds. In 2026, TD is targeting a ~13% adjusted ROE (above RBC's estimate of 12.7%) with U.S. Retail adjusted earnings of US$2.9 billion (RBC estimates US$2.7 billion).

However, the biggest difference is the incremental NCIB, Mihelic said. "We currently model TD to repurchase 41 million common shares over the next two quarters (the existing NCIB and nothing more). Adopting the upper end of the NCIB program (and the above mentioned U.S. Retail differences) would suggest a hypothetical core EPS of $9.15 (or ~4% upside) for 2026 versus our current estimate of $8.81."

TD is rated Sector Perform, with a $93 target.

Price: 111.70, Change: +0.59, Percent Change: +0.53