Bank of Nova Scotia (BNS) Dips More Than Broader Markets: What You Should Know

Bank of Nova Scotia (BNS) closed the most recent trading day at $51.90, moving -0.27% from the previous trading session. This change lagged the S&P 500's 0.07% loss on the day. At the same time, the Dow added 0.31%, and the tech-heavy Nasdaq lost 3.22%.

Heading into today, shares of the bank had gained 6.57% over the past month, outpacing the Finance sector's gain of 5.92% and the S&P 500's gain of 4.64% in that time.

Bank of Nova Scotia will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.52, down 10.59% from the prior-year quarter.

BNS's full-year Zacks Consensus Estimates are calling for earnings of $6.11 per share and revenue of $24.59 billion. These results would represent year-over-year changes of -7.42% and +0.72%, respectively.

Investors might also notice recent changes to analyst estimates for Bank of Nova Scotia. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Bank of Nova Scotia is currently a Zacks Rank #4 (Sell).

Investors should also note Bank of Nova Scotia's current valuation metrics, including its Forward P/E ratio of 8.52. For comparison, its industry has an average Forward P/E of 8.09, which means Bank of Nova Scotia is trading at a premium to the group.

Meanwhile, BNS's PEG ratio is currently 1.9. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. BNS's industry had an average PEG ratio of 0.92 as of yesterday's close.

The Banks - Foreign industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 18, which puts it in the top 8% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow BNS in the coming trading sessions, be sure to utilize

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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