For anyone looking to invest in a company that is relatively large, stable and strong with a relatively high yield, National Bank looks attractive this week. There’s not much to describe: it’s a bank, with retail and commercial banking services as well as investment and pension management. They do what you’d expect a bank to do.
The dividend yield is currently 3.73%, better than 10-year Government of Canada bonds (2.99%). The difference being that NA shares can either rise or fall in value, but over 10 years there seems like a pretty fair chance of growth. Experts are divided on whether or not this present a good value right now. It’s the sixth bank in Canada (after the “big five”), so it’s traditionally been valued slightly lower than other banks. Having said that, it’s done very well over the past five years, by comparison. The other indication that it should continue to do well is that its dividend yield is well above its five year average (2.65%). That could be corrected by an increase in share price.
NA has joined my top five stocks, rated for momentum. The smart money has been buying this, and I expect it will continue to do well for a couple weeks. As an aside, the ticker symbol for National Bank, NA, always makes me smile, as though it meant N/A, no ticker symbol available for this stock.