Toronto Story

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TD -- USA Stock  

USD 45.81  0.82  1.76%

Toronto Dominion Bank is scheduled to announce its earnings tomorrow. While some millenniums are indifferent towards financial services space, it makes sense to digest Toronto Dominion Bank as a unique investment alternative. I will address a few possible reasons shareholders do not currently respect this stock.
Published over a month ago
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Should I exit my Toronto (NYSE:TD) position?
Toronto Dominion Bank reports 162.15 B of total liabilities with total debt to equity ratio (D/E) of 15.2, which implies that Toronto Dominion may not be able to produce enough cash to satisfy its debt commitments. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Toronto Dominion has an asset utilization ratio of 2.32 percent. This indicates that the company is making $0.0232 for each dollar of assets. An increasing asset utilization means that Toronto Dominion Bank is more efficient with each dollar of assets it utilizes for everyday operations.
Toronto Dominion financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Toronto Dominion, including all of Toronto Dominion's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Toronto Dominion assets, the company is considered highly leveraged. Understanding the composition and structure of overall Toronto Dominion debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

How important is Toronto Dominion's Liquidity

Toronto Dominion financial leverage refers to using borrowed capital as a funding source to finance Toronto Dominion Bank ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Toronto Dominion financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Toronto Dominion's total debt and its cash.

How Toronto utilizes its cash?

To perform a cash flow analysis of Toronto Dominion, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Toronto Dominion is receiving and how much cash it distributes out in a given period. The Toronto Dominion cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Breaking it down a bit more

The entity generated the yearly revenue of 27.33 B. Reported Net Income was 8.31 B with gross profit of 38.04 B.

Our perspective of the latest Toronto Dominion surge

Value At Risk just dropped to -2.79, may indicate upcoming price decline. Toronto Dominion Bank has relatively low volatility with skewness of 0.72 and kurtosis of 4.39. However, we advise all investors to independently investigate Toronto Dominion Bank to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns.

Our Final Perspective on Toronto Dominion

Although some companies under the banks?diversified industry are still a bit expensive, Toronto Dominion may offer a potential longer-term growth to shareholders. With a less-than optimistic outlook for your 30 days horizon, it may be a good time to exit some or all of your Toronto Dominion holdings as it seems the potential growth was already fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Toronto Dominion.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Achuva Shats do not own shares of Toronto Dominion Bank. Please refer to our Terms of Use for any information regarding our disclosure principles.

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