11:56 AM EDT, 08/23/2024 (MT Newswires) -- RBC has trimmed its one year target on TD Bank to $88 (from $89) and kept its Outperform rating, after the bank reported its second quarter results.

Analyst Darko Mihelic notes that TD's earnings were "a little noisy" as weather-related claims impacted insurance earnings. He sees earnings power as closer to $2.16 per share, but expense creep seems to be an issue. Credit quality is seen as stable.

RBC is modeling a US$1 billion AML-related provision in the fourth quarter, and a final resolution to its AML issues is close at hand. "We do not anticipate a "hard" asset cap for TD, but expect higher expenses and some growth challenges in the U.S. We believe valuations reflect too much pessimism on earnings power and capital."

Price: 80.85, Change: +1.26, Percent Change: +1.58