On Thursday, Toronto-Dominion Bank (TSX:TD)'s stock rating experienced a positive shift as Jefferies upgraded its assessment from Hold to Buy. This adjustment came with an increase in the price target, moving to Cdn$90.00 from the previous Cdn$82.00.
The financial institution, listed on both the Toronto Stock Exchange (TD:CN) and the New York Stock Exchange (NYSE: TD), received this revised outlook following a period of valuation adjustments.
Currently trading near its 52-week low with a market capitalization of $93.61 billion, TD Bank maintains a P/E ratio of 14.98, suggesting potential value opportunity.
The upgrade was based on the view that the market has fully accounted for the less favorable news reflected in the bank's fourth quarter earnings. Jefferies believes that Toronto-Dominion Bank's stock valuation has decreased adequately to incorporate all concerns. As the year advances, expectations are set for the bank's multiple to regain some of the ground it lost.
According to InvestingPro analysis, TD Bank appears undervalued based on its proprietary Fair Value model, with additional insights available through their comprehensive Pro Research Report.
Jefferies anticipates that there is potential for further stock price appreciation if Toronto-Dominion Bank can show any additional earnings growth. This perspective is underpinned by the assumption that the market has already priced in the negative aspects, and any positive developments could lead to a re-rating of the stock.
Toronto-Dominion Bank is now positioned as Jefferies' top pick for the year 2025. This endorsement is indicative of the firm's confidence in the bank's ability to outperform in the coming period. The financial institution is expected to not only recover from its recent valuation dip but also to capitalize on any incremental earnings increases.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.