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Bank of Nova Scotia (TSX:BNS), better known as “Scotiabank,” is one of Canada’s highest-yielding bank stocks and the highest-yielding Big Six bank. At today’s prices, it yields 6.66%, meaning that it can add a lot of income potential to a portfolio if everything goes well.
The question is whether things will go well. Over the last five years, BNS has lagged behind its Big Six peers in both revenue growth and earnings growth. Although it has managed a moderate amount of revenue growth, its earnings per share (EPS) have actually gone down over that entire five-year period!
I don’t mean to exaggerate that point — the decline is only about 1% on a compound annual growth rate (CAGR) basis. However, most TSX banks have experienced significant positive growth over the same period in which BNS’s earnings declined.
Past performance does not predict future performance. Nevertheless, based on its…
