BNS Stock on the TSX Just Beat Earnings Again — So Why Are Analysts Still Saying Hold?

On most mornings, the lobby of a building on King Street West in Toronto, which houses Scotiabank’s main branch and serves as a sort of architectural anchor for the financial district, moves with the unique energy of a city that takes its banks seriously. There is nothing like Canada’s relationship with its Big Five lenders in the US. These are not merely financial establishments. They are pieces of public furniture. And yet, among the five, Scotiabank has spent the better part of the last three years being the one that people aren’t quite sure what to do with. With a 52-week low of $62.57, a high of $106.39, and a close on March 31, 2026, of $96.47, up 2.76 percent on the day, the BNS stock price on the TSX quietly narrates that tale.

That one-day gain was a component of a larger TSX rally that was linked to strength in gold and financials as well as geopolitical relief regarding the Iran conflict. Beneath it, however, is a more detailed BNS story that has been developing since CEO L. Scott Thomson took over in February 2023 and started methodically dismantling what his predecessor had spent ten years assembling. With strong ties to Latin American markets like Colombia, Peru, Chile, and Mexico, Scotiabank has emerged as the most globally exposed Canadian bank. The international-first strategy is being refocused.

The shift is in the direction of more stable and advanced North American markets. KeyCorp has more volatility than Pacific Alliance. The acquisition of a roughly 14.9 percent share in Cleveland-based regional lender KeyCorp by Scotiabank in 2024 caused controversy at first, but it has since become a key component of Thomson’s case for the bank’s future.

The Q1 2026 figures provided some concrete evidence to support that claim. Revenue exceeded analyst estimates of $6.99 billion by a significant margin, coming in at $8.46 billion, up more than 23 percent year over year. The $1.48 earnings per share exceeded the $1.42 consensus. 12.49 percent was the return on equity. By Royal Bank’s or TD’s standards, these figures are not particularly impressive, but they are still strong and, more significantly, they are getting better. In banking, the direction of travel is just as important as the absolute level, and in this case, the direction is upward.

The analyst community hasn’t caught up, which is interesting. With an average target price of about $106, the consensus rating on BNS is still “Hold,” suggesting significant upside from the current $96 level but lacking the conviction to call it a buy. In early March, Canaccord Genuity actually downgraded the stock from strong-buy to hold. TD Securities reaffirmed its hold. Raising its target to $106, Royal Bank of Canada described it as a “sector perform.” That wording has an almost diplomatic quality; it’s not a clear endorsement, but it’s also not dismissive. It’s similar to watching someone describe a meal as “interesting” when they’re not sure if they enjoyed it when you watch the analyst community navigate BNS at the moment.

Income-focused investors find the hesitation perplexing in part because of the dividend. With a yield of about 4.56 percent, Scotiabank outperforms all of its Big Five competitors. Despite a period of market turbulence that put bank stocks worldwide to the test, the $1.10 quarterly payment has been maintained. In the Bay Street investment community, more than a century of continuous dividend payments is not a statistic that is taken lightly. That yield, when paired with a P/E of 14.38, is a truly attractive entry point for a TFSA investor constructing a cash flow portfolio—the type of Canadian retail investor who owns a significant portion of BNS. The market may just be pricing in the execution risk associated with the strategic shift. While the bank reorients, Thomson is asking investors to exercise patience, which comes at a price when the alternatives are doing well.

The story of institutional activity is somewhat different. In the second quarter of last year, the Public Sector Pension Investment Board increased its BNS position by over 1,000%. More than 2.1 million shares were added by British Columbia Investment Management. Citigroup, Addenda Capital, and Amundi all increased their investments. Institutional investors currently own about 49% of the stock, indicating that the big money is comfortable holding it even if it isn’t yet ready to pound the table.

It’s difficult to ignore the fact that BNS on the TSX is trading below what most objective analysis indicates it ought to be. For a bank of this size and background, the difference between the current price and the analyst consensus target is larger than it typically is. Either an opportunity or a reflection of something the market perceives that the targets do not yet take into consideration can be found in that gap. Because of Thomson’s limited experience, the solution is not immediately apparent. From the outside, a 14x P/E looks exactly like the uncertainty surrounding the KeyCorp investment, the North American refocus, and the cost discipline he has been discussing since his first earnings call.