Track market-moving stories before they get noisy

On July 20, 2026, we take a closer look at the DCF analysis for The Toronto-Dominion Bank (TD), which has shown impressive price performance over the past year,

All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.

While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.

Headquartered in Toronto, Toronto-Dominion Bank (TD - Free Report) is a Finance stock that has seen a price change of 30.45% so far this year. The retail and wholesale bank is currently shelling out a dividend of $0.79 per share, with a dividend yield of 2.57%. This compares to the Banks - Foreign industry's yield of 2.71% and the S&P 500's yield of 1.34%.

Looking at dividend growth, the company's current annualized dividend of $3.15 is up 5.5% from last year. Over the last 5 years, Toronto-Dominion Bank has increased its dividend 3 times on a year-over-year basis for an average annual increase of 5.24%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Toronto-Dominion's current payout ratio is 45%, meaning it paid out 45% of its trailing 12-month EPS as dividend.

Earnings growth looks solid for TD for this fiscal year. The Zacks Consensus Estimate for 2026 is $6.86 per share, representing a year-over-year earnings growth rate of 14.72%.

From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. However, not all companies offer a quarterly payout.

For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, TD is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of #3 (Hold).

Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.

While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.

Toronto-Dominion Bank (TD - Free Report) is headquartered in Toronto, and is in the Finance sector. The stock has seen a price change of 26.99% since the start of the year. The retail and wholesale bank is currently shelling out a dividend of $0.78 per share, with a dividend yield of 2.6%. This compares to the Banks - Foreign industry's yield of 2.73% and the S&P 500's yield of 1.41%.

Looking at dividend growth, the company's current annualized dividend of $3.11 is up 4.2% from last year. Over the last 5 years, Toronto-Dominion Bank has increased its dividend 3 times on a year-over-year basis for an average annual increase of 5.24%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Toronto-Dominion's current payout ratio is 45%, meaning it paid out 45% of its trailing 12-month EPS as dividend.

TD is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $6.86 per share, with earnings expected to increase 14.72% from the year ago period.

Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. It's important to keep in mind that not all companies provide a quarterly payout.

High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, TD is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of #3 (Hold).

Even with a recent pullback, Micron Technology's (MU +0.32%) stock remains sizzling hot. Shares of the memory chipmaker have soared roughly 750% over the past 12 months. Micron is up more than 250% year to date, ranking it No. 4 among top performers in the S&P 500 (^GSPC +0.44%).

Can this high-flying stock's momentum continue? Probably. I predict that Micron's stock will skyrocket after the company reports its third-quarter earnings on June 24.

Image source: Micron Technology.

The numbers behind the prediction Micron has set new quarterly revenue records for four consecutive quarters. It will almost certainly do so again with its Q3 results. The company projects Q3 revenue of $33.5 billion, roughly 3.6 times its revenue in the prior-year period and a 40% increase from the previous quarter.

Analysts are even more optimistic. The consensus Wall Street Q3 revenue estimate is $34.5 billion, roughly 270% higher than Micron's revenue in the same period in 2025.

Micron's Q3 earnings should also be spectacular. The company expects adjusted earnings per share (EPS) of $19.15 at the midpoint of its guidance range. Wall Street looks for adjusted EPS of $19.72. To put those numbers in context, Micron posted adjusted EPS of only $1.91 for the third quarter of 2025.

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Will Micron be able to top these lofty estimates? I think so. The company has beaten consensus earnings expectations in eight of the past nine quarters. Its business is in the strongest position it has ever been in. Micron's 2026 high-bandwidth memory (HBM) supply is entirely sold out. Management says that demand is so great that the company can "fulfill only 50% to two-thirds" of memory orders for key customers.

There's one other key indicator that boosts my confidence that Micron's stock will take off after its Q3 update: Analysts are raising their price targets on the stock. As a case in point, TD Cowen (TD 0.39%) increased its 12-month price target for Micron last week from $660 to $1500.

What could go wrong Admittedly, my prediction could be a bust. Several things could go wrong and prevent Micron's shares from skyrocketing after June 24. If the company delivered disappointing Q3 results, its stock will almost certainly sink. If management gives any reason to suspect that demand will soften in the near term, expect a sell-off.

Micron remains a cyclical stock, as it always has been. However, I think the current exceptionally strong up cycle still has plenty of room to run. And so does Micron's stock.

Keith Speights has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.

On June 15, 2026, we delve into the DCF analysis for The Toronto-Dominion Bank TD , which has shown impressive price performance over the past year. The stock has appreciated significantly, with a year-to-date increase of 26.6% and a remarkable 71.9% rise over the past year. Here are some key points to consider:

DCF Earnings-based intrinsic value of $83.11 compared to the current price of $117.33, indicating a margin of safety of -30.3%. DCF FCF-based intrinsic value stands at $-53.59, suggesting a second opinion on valuation. GF Score™ of 74/100 indicates a moderate reliability of the DCF inputs. What Is TD Worth? DCF Earnings-Based Model The DCF earnings-based model for TD utilizes a two-stage approach to estimate its intrinsic value. The first stage considers a growth phase where earnings per share (EPS) is projected to grow at a rate of 6.2% annually for the next ten years. The second stage accounts for a terminal growth rate of 4% for the subsequent ten years. The discount rate applied is 11%, which combines the risk-free rate and the equity risk premium.

Parameter Value Current EPS (TTM, excl. non-recurring) $6.66 10-Year Growth Rate 6.2% 10-Year Treasury Rate 4.45% Discount Rate (ceil(Treasury) + 6%) 11% Terminal Growth Rate 4% The calculation summary for the two-stage model is as follows:

Stage Description Value Growth Stage (Years 1-10) EPS growing at 6.2%, discounted at 11% $52.66 Terminal Stage (Years 11-20) 4% terminal growth, discounted at 11% $30.45 Intrinsic Value Growth + Terminal $83.11 With the current price at $117.33, the intrinsic value of $83.11 indicates that TD is modestly overvalued, with a margin of safety of -30.3%. It is important to note that GuruFocus utilizes EPS excluding non-recurring items, as research indicates that stock prices correlate more closely with earnings than free cash flow. For further calculations, you can visit the TD DCF Calculator.

What Does the Free Cash Flow DCF Say? The free cash flow (FCF) based DCF model presents a stark contrast to the earnings-based model, yielding an intrinsic value of $-53.59. This significant discrepancy highlights the potential disagreement between the two valuation methods. The FCF-based model suggests that TD is significantly overvalued, with a margin of safety of -100.0%.

How Does GF Value™ Compare to the DCF Models? The GF Value™ of $80.05 provides a third perspective on TD's valuation. This proprietary measure is calculated based on historical trading multiples, past business growth, and future performance estimates. The GF Value™ aligns with the earnings-based DCF model, indicating that all three models suggest TD is overvalued.

For more insights, you can check the GF Value™ page.

What Does TD's GF Score™ Tell Us? The GF Score™ ranks stocks from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have historically generated higher long-term returns (backtested from 2006 to 2021).

Metric Rating GF Score™ 74/100 Financial Strength 2/10 Profitability 6/10 Growth 9/10 Valuation 3/10 Momentum 9/10 With a predictability rank of 3/5 stars, this indicates that the DCF model is moderately reliable for TD. For more details, visit the TD stock page.

Key Assumptions and Limitations It is essential to recognize that DCF models are highly sensitive to the assumptions made regarding growth rates and discount rates. Additionally, stocks with low predictability ratings tend to produce less reliable DCF estimates. The terminal growth rate of 4% is a simplifying assumption that may not reflect future market conditions accurately.

What This Means for Investors In summary, the three valuation models—DCF earnings, DCF FCF, and GF Value™—converge on the conclusion that TD is overvalued at its current price of $117.33. The earnings-based intrinsic value of $83.11 and the FCF-based intrinsic value of $-53.59, along with the GF Value™ of $80.05, all suggest caution for potential investors.

For the full DCF analysis, visit the TD DCF Calculator. You can also explore the GF Value™ page, or use the GuruFocus Stock Screener to find undervalued predictable companies.

Frequently Asked Questions What is TD's intrinsic value based on DCF?

Answer: earnings-based $90.07, FCF-based $-53.59

Is TD overvalued or undervalued?

Answer: Based on the DCF and GF Value™ consensus, TD is overvalued.

How reliable is the DCF model for TD?

Answer: The predictability rank of 3/5 indicates a moderate reliability of the DCF model for TD.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Second Annual TD Survey Finds Small Businesses Are Eager to Level Up to Grow, Modernize Operations, Adopt AI and Strengthen Fraud Defenses

MOUNT LAUREL, N.J.--(BUSINESS WIRE)--Small business owners across the U.S. are going through the year with confidence and growth ambitions, but many remain financially vulnerable beneath the surface, according to the second annual Financial Preparedness Survey: Small Business Owners’ Report from TD.

The survey finds that, while 94% of small business owners say they feel financially prepared for the next 12 to 18 months, only 24% report having more than six months of emergency savings to cover operating expenses. At the same time, more than one-third of owners (34%) say a business should ideally have more than six months of reserves to be considered financially prepared, underscoring a gap between confidence and cushion.

"Working capital is critical to both short- and long‑term stability for small businesses, giving owners the flexibility they need to adjust and adapt as the landscape changes," said Andy Bregenzer, Head of Regional and Small Business Banking and Co-Head of Commercial Banking, TD Bank U.S. "But our survey data shows that while financial preparedness is top of mind for small business owners, it is not reflective of their true financial state. Our advice to small business owners is build financial resilience. It is not just about business survival, but about positioning their businesses to grow with confidence no matter what the future holds."

Optimism Is Back Even as Risk Stays Front and Center

The majority of small business owners (74%) expect the macroeconomic environment to improve over the next 12-18 months, signaling a directional increase from 2025. Yet optimism is tempered by persistent, day-to-day risks that could impact financial preparedness, including:

Cybersecurity or fraud incidents (46%) High input costs such as materials, utilities and insurance (44%) Unexpected declines in sales or revenue (39%) Difficulty hiring or retaining workers (37%) Fraud, in particular, has become a widespread concern. More than half of respondents (54%) say their business experienced fraud or attempted fraud in the past year, and 12% report that it resulted in financial loss.

AI Goes Mainstream for Small Businesses

One of the most significant shifts revealed by the survey is the rapid adoption of artificial intelligence. Nearly seven in 10 small business owners (69%) say they are now using AI to help decrease expenses, a sharp increase from 39% last year.

Rather than replacing workers, most owners see AI as a tool to scale smarter.

60% say adopting AI will increase their workforce size, compared to 10% who say it will decrease it. Over the past 12 months, small business owners say the biggest benefits of AI/automation for their business have been improving customer service (53%), improving fraud and cybersecurity protection (47%) and helping increase sales leads (42%). 95% say they're likely to use the AI guidance and resources available through their bank in the next 12 to 18 months. Financing Seen as Fuel for “Leveling Up”

Despite lingering risks, small businesses are eyeing growth. The survey finds that 93% of respondents are likely to consider applying for a loan or line of credit in the next 12 to 18 months, up from 82% last year, and 96% say financing would be necessary or potentially necessary to "level up" their business.

When asked what leveling up means, owners most often point to growth and market expansion (54%), stronger operations, systems and processes (47%), and improved financial performance (45%). Loans and lines of credit are expected to support not only growth, but also modernization efforts such as AI adoption, cybersecurity investments and operational upgrades.

The percentage of small business owners planning to obtain a loan or line of credit from their bank increased from 33% to 55%.

“These findings reflect what we are hearing from small business owners every day. They are looking to grow, and they are seeking credit as a way to fund more than just their day-to-day operations, they are looking to invest in modernization, adopt AI, and strengthen fraud defenses,” said Chris Ward, Head of Small Business Banking, TD Bank U.S. “At TD, we’re focused on delivering clear strategies and practical tools to help businesses turn that ambition into long-term resilience.”

The Need for Trusted Guidance

For America’s small business owners, today’s economic environment isn’t just about inflation, interest rates or market volatility; it’s about managing growing complexity. With 2.3 million small businesses nationwide owned by aging Boomers preparing to retire*, many are navigating this moment while also figuring out how to adopt new digital tools and AI.

As complexity rises, owners are looking for more support: Forty percent say that finding advice from a trusted financial partner has been a challenge, even as an overwhelming majority (95%) say they would likely use AI-driven guidance or resources offered through their bank in the next 12-18 months. Additionally, the percentage of owners who are considering hiring a financial advisor to improve their business outlook in the next 12-18 months rose to 53%, up from 27% in 2025.

"Today’s small business owners don’t just want access to capital, they want clarity on how they can use it to make most of growth opportunities," Ward said. "We as a bank have an opportunity to play a bigger role by simplifying complexity and helping owners make confident, informed decisions. This is what we are focused on."

Together, the findings paint a picture of a small business sector that is disciplined, ambitious and increasingly tech-enabled, but still looking for trusted guidance as it navigates risk, growth and uncertainty. As owners embrace new technologies and focus on building resilience and seizing opportunities for expansion, they are seeking resources, support and strategic decision-making from their bankers.

Survey Methodology

This survey was conducted by Wakefield Research among 1,000 small business owners (100 employees or fewer, $100,000+ in annual revenue), including 250 respondents nationwide and 125 respondents each in New York City, Boston, Washington, D.C., South Florida, the greater Philadelphia area, and Charlotte. The survey was fielded March 13–26, 2026 via email invitation and online questionnaire.

* https://project-equity.org/press-releases/2-3-million-small-businesses-nationwide-owned-by-aging-boomers-preparing-to-retire-puts-1-in-6-employees-jobs-at-risk-based-on-a-project-equity-study/

About TD Bank U.S.

TD Bank US Holding Company and its subsidiaries, including TD Bank, N.A., are collectively known as TD Bank U.S. As the U.S. banking business of The Toronto-Dominion Bank (TSX and NYSE: TD), a leading North American financial services firm, TD Bank U.S. serves more than 10 million clients and has a network of approximately 1,050 locations throughout the Northeast, Mid-Atlantic, Carolinas and Florida. We support our clients and communities with a full range of retail, small business, and commercial banking products and services. We also offer customized private banking and wealth management services, a comprehensive suite of credit card products for consumers and businesses, and automotive vehicle financing and dealer commercial services. TD Bank U.S. is one of the largest banks in the U.S. by assets and is headquartered in Mount Laurel, N.J. To learn more, visit www.td.com/us.

On May 04, 2026, we take a closer look at the DCF analysis for The Toronto-Dominion Bank TD , which has shown impressive price performance over the past year. The stock has increased by 76.2%, reflecting strong market confidence.

DCF Earnings-based intrinsic value of $79.11 vs current price of $107.31 (margin of safety: -25.2%) DCF FCF-based intrinsic value of $-48.05 vs current price (second opinion indicates significant overvaluation) GF Score™ of 84/100 suggests a reliable assessment of the DCF inputs What Is TD Worth? DCF Earnings-Based Model The DCF earnings-based model for The Toronto-Dominion Bank TD utilizes a two-stage approach to estimate the intrinsic value of the stock. In the first stage, we project earnings growth over the next ten years, followed by a terminal growth phase. The assumptions used in this model are critical for determining the intrinsic value accurately.

Parameter Value Current EPS (TTM, excl. non-recurring) $6.34 10-Year Growth Rate 6.2% 10-Year Treasury Rate 4.37% Discount Rate (ceil(Treasury) + 6%) 11% Terminal Growth Rate 4% The first stage of the model anticipates that EPS will grow at a rate of 6.2% per year for the next ten years, discounted at a rate of 11%. The calculated value from this growth stage is $50.13 per share. In the second stage, we assume a terminal growth rate of 4% for the following ten years, also discounted at 11%, resulting in a terminal stage value of $28.98 per share.

Stage Description Value Growth Stage (Years 1-10) EPS growing at 6.2%, discounted at 11% $50.13 Terminal Stage (Years 11-20) 4% terminal growth, discounted at 11% $28.98 Intrinsic Value Growth + Terminal $79.11 Comparing the current price of $107.31 to the intrinsic value of $79.11 indicates that the stock is fairly valued, with a margin of safety of -25.2%. It is important to note that GuruFocus uses EPS excluding non-recurring items, as research indicates that stock prices are more closely correlated with earnings than with free cash flow. For further analysis, you can visit the TD DCF Calculator.

What Does the Free Cash Flow DCF Say? In contrast to the earnings-based DCF model, the free cash flow (FCF) based intrinsic value for TD is calculated at $-48.05. This starkly contrasts with the earnings-based valuation, indicating a significant overvaluation of the stock with a margin of safety of -100.0%. This discrepancy suggests that while earnings may present a fair valuation, the free cash flow perspective raises concerns about the stock's current pricing.

How Does GF Value™ Compare to the DCF Models? The GF Value™ of The Toronto-Dominion Bank is calculated at $78.05, offering a third perspective on the stock's valuation. GF Value™ is GuruFocus' proprietary measure derived from historical trading multiples, past business growth, and future performance estimates. When comparing all three models, the earnings-based DCF and GF Value™ align closely, indicating fair valuation, while the FCF model suggests significant overvaluation. For more details, visit the GF Value™ page.

What Does TD's GF Score™ Tell Us? The GF Score™ ranks stocks on a scale from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have historically generated higher long-term returns (backtested from 2006 to 2021).

Metric Rating GF Score™ 84/100 Financial Strength 3/10 Profitability 7/10 Growth 9/10 Valuation 5/10 Momentum 9/10 The predictability rank for TD is 3/5 stars, indicating that the DCF model's estimates for this stock are relatively reliable. For more information, visit the TD stock page.

Key Assumptions and Limitations It is important to note that DCF models are highly sensitive to the assumptions made regarding growth rates and discount rates. Stocks with lower predictability ratings tend to produce less reliable DCF estimates. Additionally, the terminal growth rate of 4% is a simplifying assumption that may not capture all future growth dynamics.

What This Means for Investors In conclusion, synthesizing the three valuation models—DCF earnings, DCF FCF, and GF Value™—suggests that The Toronto-Dominion Bank is currently fairly valued according to the earnings-based DCF and GF Value™. However, the FCF model indicates significant overvaluation. This mixed assessment highlights the importance of considering multiple valuation perspectives before making investment decisions. For the full DCF analysis, visit the TD DCF Calculator. You can also explore the GF Value™ page, or use the GuruFocus Stock Screener to find undervalued predictable companies.

Frequently Asked Questions What is TD's intrinsic value based on DCF?

earnings-based $85.73, FCF-based $-48.05

Is TD overvalued or undervalued?

Based on the DCF earnings model and GF Value™, TD is fairly valued, while the FCF model suggests it is overvalued.

How reliable is the DCF model for TD?

The predictability rank of 3/5 indicates that the DCF model for TD is relatively reliable.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.

While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.

Based in Toronto, Toronto-Dominion Bank (TD - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 14.33%. The retail and wholesale bank is currently shelling out a dividend of $0.78 per share, with a dividend yield of 2.88%. This compares to the Banks - Foreign industry's yield of 2.76% and the S&P 500's yield of 1.43%.

Looking at dividend growth, the company's current annualized dividend of $3.11 is up 4.2% from last year. Over the last 5 years, Toronto-Dominion Bank has increased its dividend 3 times on a year-over-year basis for an average annual increase of 5.24%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Toronto-Dominion's current payout ratio is 47%, meaning it paid out 47% of its trailing 12-month EPS as dividend.

Looking at this fiscal year, TD expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $6.90 per share, which represents a year-over-year growth rate of 15.38%.

Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer a quarterly payout.

Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, TD presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).

📌 Top story -- scroll down for more updates

Beazer Won't Sell Itself Short 4:15pm DFH -13.37% today, BZH -7.31% today

By Buck Hartzell

Beazer Homes (BZH +4.74%) rejected Dream Finders’ (DFH +3.60%) latest cash offer to purchase the company for $25.75 per share. They stated the new offer was an 11% reduction from the March 17 proposal. Beazer’s most recently reported book value was $41.83 per share. Beazer plans to sell off non-core assets worth $150 million and continue to execute their plan. Both companies sold off on the news. The deal certainly makes sense from a strategic standpoint for DFH. A quick look at the 10 year price-to-book value reveals that Beazer averages about 0.68x book value, not far from DFH’s offer of 0.61x.

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Closing Bell 4:06 pm

April CPI came in hotter than expected at 3.8% annually, driven by a gasoline surge, pushing 10-year Treasury yields to a one-year high of 4.46%. The Nasdaq is taking the worst of it: Stock Advisor (Team HG) rec Intel (INTC +9.82%), Qualcomm (QCOM +6.14%), and Micron (MU +10.69%) are each off 4% or more, while the S&P 500 and Dow are near flat.

Oil joins the pressure: Brent crude jumped 3.4% to $107.77/barrel as Mideast tensions show no signs of easing, adding to inflation worries. Chips led the rally, now lead the retreat: The semiconductor stocks that surged hardest over the past month are absorbing the steepest losses today, a reminder that high-momentum stocks carry high-reversal risk. UPS: Down 50%, Yield 6.5%. Hmm. 3:44 pm — UPS -1.13%

Amazon (AMZN +1.30%) just announced it’s opening its legendary delivery machine to every business on the planet — and UPS (UPS +4.98%) investors are not thrilled. UPS stock is already down 50%-plus over five years, and now it has a trillion-dollar rival muscling into its lane. "I'm glad I sold all my UPS stock when I retired in 2020," yamablasterx2 wrote last week. Consider this, though: UPS has already been dumping Amazon as a customer to chase better margins. It's hard to lose a customer you were already kicking out.

The "we broke up first" defense: UPS is slashing 30,000 jobs and tightening its belt — painful, but it’s building a leaner business that doesn’t need Amazon anyway. Amazon’s graveyard of grand ambitions: Remember when Amazon was going to conquer groceries? Healthcare? Logistics disruption is real, but Amazon has a habit of making big splashes that take forever to materialize.

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AST SpaceMobile Craters After Earnings Miss 3:11 pm — ASTS -12.37%

AST SpaceMobile (ASTS +12.25%) fell 13% Tuesday after Q1 results that, to put it gently, were not great. Analysts wanted $0.21 in losses per share on $37.5M in revenue. They got $0.66 in losses on $14.7M. The silver lining is that revenue grew 20-fold year over year. The less-silver lining: free cash flow was negative $427.4M.

Houston, we have a burn rate: AST’s cash bonfire is real, but so is its $3.5B war chest, and the company is racing to get 45 satellites in orbit by year-end after losing one to a botched Blue Origin launch last month. Don’t hold your breath: Management declined to promise consumer DTC service anytime soon, which means the part where AST actually makes money remains a future-tense situation.

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One Fund Took Its UNFI Profits and Ran 2:56 pm — UNFI -1.24%

Quantedge Capital just decided 85% was enough. The fund disclosed an SEC filing showing it sold its entire United Natural Foods (UNFI 1.50%) stake in Q1 — roughly 88,000 shares worth an estimated $3.37 million. UNFI has outrun the S&P 500 by nearly 60 percentage points over the past year. Motley Fool analyst Rich Greifner recently wrote, "The company is intentionally sacrificing lower-margin conventional grocery sales to focus on natural, organic, and specialty products, which carry better margins and stronger growth potential.

The business actually looks pretty good right now: Adjusted EBITDA jumped 23% last quarter, free cash flow hit $243 million, and net leverage fell to 2.7x, the lowest since fiscal 2023. (Net leverage measures how much debt a company carries relative to its earnings; lower is better.) Management likes what it sees, too: The company raised full-year profitability guidance even while trimming revenue expectations — prioritizing margin discipline over chasing growth. 

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Android Glitch Crashes Life360’s Party 2:26 pm — LIF -12.82%

Life360 (LIF +1.38%) crushed Q1 estimates — 38% revenue growth, raised guidance, the works — and the market’s response was to knock shares down 11%. The culprit: an Android registration glitch that dinged monthly active user growth. CEO Lauren Antonoff says demand never faded, and the company isn’t sweating the long-term outlook.

The glass-half-full read: Paying families rose 27%, ad revenue quadrupled to over 10% of sales, and international users grew 26% — that’s a lot of green amid the red. Already down 40% this year: At 41 times free cash flow, the market’s expectations are high — but patient Fools may want to keep this one on their radar.

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On Holding's Margins Hit Record Highs 1:35 pm -- ONON -2.2%

By Sanmeet Deo
Team Rule Breakers

On Holding (ONON +2.42%) just delivered one of its strongest quarters ever -- and the market's reaction tells you everything about where investor psychology sits today.

Here's what happened. On crossed the CHF 800 million quarterly sales mark for the first time, growing 26.4% at constant currency in Q1 2026. The more important story, though, was profitability. Gross margin surged 430 basis points to a record 64.2% -- achieved despite meaningful U.S. tariff headwinds -- while adjusted EBITDA margin hit 21%, up 450 basis points year-over-year. Average selling prices climbed from roughly $145 to over $170. Asia-Pacific crossed 20% of global sales for the first time, growing 61.4% at constant currency, with China expanding at high double digits and an apparel penetration rate of 30% compared to just 6% companywide. Apparel also exceeded 10% of direct-to-consumer sales for the first time. These are milestones, not noise.

So what does it mean? The margin story is the real headline. Management explicitly called 64.5% the new gross margin baseline -- not a peak -- and raised full-year profitability guidance meaningfully. That reprices On's long-run earnings power. The APAC and apparel momentum together address the two most persistent bear concerns: geographic concentration and category dependency.

Today's Lunchtime News 1:30 pm -- TSLA -4.1%

Tesla (TSLA +4.27%) shares slipped after a five-session run that pushed the stock up nearly 15%, as investors looked ahead to CEO Elon Musk's trip to China with President Trump on Thursday. The visit comes alongside meetings between U.S. and China trade delegations and a separate sit-down with President Xi Jinping that also includes Boeing (BA +6.03%) CEO Kelly Ortberg and Apple (AAPL +1.35%) CEO Tim Cook.

FSD approval is the prize: The main point of negotiation for Tesla is regulatory approval of its full self-driving (FSD) software in mainland China. Musk previously targeted February or early spring, then pushed the timeline to the third quarter on the Q1 call. Chinese regulators have grown more cautious after Baidu (BIDU 1.19%) autonomous vehicles reportedly stopped mid-street, leading to a pause on autonomous vehicle licenses. China competition heats up: Tesla sold 25,956 vehicles in China in April, down nearly 10% year over year, with its share of the new-energy vehicle market slipping to 3%. Local rivals BYD (BYDDY 0.18%), Xiaomi (OTC: XIACY), and Geely (GELYF +2.61%) are pressuring Tesla, though FSD approval would be a major competitive edge.

Today's Change

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16.29

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397.88

Warsh Clears Vital Senate Vote 12:40 pm

The Senate confirmed Kevin Warsh as a Federal Reserve governor Tuesday in a 51-45 vote, clearing the path for him to be named Chair on Wednesday. Warsh succeeds Jerome Powell, who exits Friday as inflation hits a three-year high driven by the Iran war and new tariffs. While Warsh has advocated for "regime change" and signaled that interest rates could be lower, he takes the helm of the central bank during a period of intense price pressure. Though Powell will remain on the board until 2028 to oversee an internal probe, Warsh’s leadership represents a potential pivot in monetary policy that could shift the outlook for dividend-paying giants like Coca-Cola (KO 0.76%) and high-growth tech leaders such as Microsoft (MSFT 1.82%).

Divergent Rate Expectations: Despite Warsh’s public preference for cheaper capital, bond markets are currently pricing in elevated odds of a rate hike to combat energy-driven costs. A Fragile Equilibrium: The incoming Chair must navigate a "low-hire, low-fire" labor market, attempting to preserve employment stability without fueling the inflation currently hitting companies like Walmart (WMT +0.08%). Wegovy High-Dose Data Challenges Lilly 11:20 am -- NVO -0.4%

Novo Nordisk (NVO +2.65%) released clinical data Tuesday showing its 7.2-milligram high-dose Wegovy enabled "early responders" to lose an average of 27.7% of their body weight over 72 weeks. This analysis, presented at the European Congress on Obesity, aims to neutralize the efficacy advantage held by Eli Lilly (LLY +2.41%) and its rival drug Zepbound. While the broader trial group averaged 21% weight loss, the performance of these rapid responders — about one in four patients — provides a potent marketing tool as Novo fights to win back market share. Three major U.S. pharmacy benefit managers have already added the higher dose to standard formularies, accelerating the rollout of this competitive extension.

Competitive Parity: The data suggests Wegovy can finally match or exceed the 20% efficacy threshold that previously made Lilly the preferred choice for many prescribers. Variable Outcomes: Success remains non-linear; patients who failed to lose 15% within the first six months averaged a lower 15.4% total loss, highlighting the "early responder" delta. Hims Takes the Pain, Builds the Moat 11:15 am -- HIMS -12.4%

By Sanmeet Deo
Team Rule Breakers

Hims & Hers Health (HIMS +3.92%) just delivered its worst GAAP quarter since going public, and the market is punishing it accordingly -- shares are down roughly 12% today. Revenue grew just 4% year-over-year to $608 million, a brutal deceleration from 111% growth a year ago, while a net loss of $92 million erased all the hard-won profitability the company had built. The immediate pain comes from Q2 EBITDA guidance actually lower than what was just reported, with gross margins guided to compress further still. Investors who chased the stock up 50% in the prior month are getting a cold shower instead.

The so-what is that almost all of this damage was deliberate. Hims walked away from its compounded semaglutide business overnight and relaunched with branded Wegovy and Zepbound. Within six weeks, 125,000+ shipments were fulfilled and the company is tracking to add over 100,000 new weight-loss subscribers per month, demand the CFO said exceeded even the Super Bowl campaigns. Full-year revenue guidance was raised to $2.8–$3.0 billion, and the CFO stated branded and compounded unit economics are "roughly comparable" on a dollar basis, meaning this is a timing problem, not permanent margin destruction.

Amazon Starts 30-Minute Drops 10:15 am -- AMZN -1.5%

Amazon (AMZN +1.30%) is launching "Amazon Now," a service delivering packages in 30 minutes or less across dozens of U.S. cities. Utilizing a network of micro-fulfillment "dark stores" and Flex drivers, the retail giant aims to reach tens of millions of customers by year-end. This aggressive move directly challenges gig-economy rivals like DoorDash (DASH +2.38%) and Uber (UBER +0.96%) by offering 24/7 access to everything from electronics to groceries. CEO Andy Jassy maintains that ultra-fast speeds drive higher conversion and customer retention, effectively turning logistics into a competitive weapon against brick-and-mortar leader Walmart (WMT +0.08%).

Dark Store Strategy: By shifting inventory to 5,000-square-foot urban hubs rather than highway warehouses, Amazon minimizes the "last mile" to minutes rather than hours. Fee Structure Shifts: Prime members will pay a $3.99 premium for the lightning-speed service, creating a high-margin revenue stream that offsets the increased cost of rapid, on-demand logistics.

Today's Change

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1.30

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3.10

Current Price

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241.10

Hims & Hers Stock Plummets on Widening Loss 10:10 am -- HIMS -9.9%

Hims & Hers Health (HIMS +3.92%) shares tanked by up to 15% Tuesday as the telehealth firm’s first-quarter net loss nearly doubled to $92 million. While revenue nudged up 4% to $608 million, investors were spooked by a significant drop in adjusted EBITDA and a lowered outlook. The company is navigating a painful transition after settling with Novo Nordisk (NVO +2.65%) to stop selling cheap, compounded versions of weight-loss drugs like Wegovy. Under the new pact, Hims will sell branded GLP-1s but must cease the "mass compounding" that previously fueled its margins. With revenue per subscriber slipping to $80, the firm faces a steep uphill climb to prove its business model works without patented shortcuts.

Shortage Loophole Closes: Hims previously exploited a regulatory loophole allowing non-patent holders to sell drugs during shortages, but the resolution of GLP-1 supply issues has rendered this strategy obsolete. Safety First, Profits Second: Novo Nordisk’s legal pressure forced Hims to pull its $49 "copycat" pills, a move that clarifies the company's regulatory risk but leaves a $350 million EBITDA goal looking increasingly ambitious. Opening Bell 9:35 am -- MU -4.5%, AMD -1.3%, QCOM -5.7%

The S&P 500 pulled back from record highs Tuesday after April’s Consumer Price Index hit 3.8%, its highest annual level since 2023. This hotter-than-expected data, driven by West Texas Intermediate futures surging past $100, sparked a sell-off in high-flying tech names. Micron Technology (MU +10.69%) reversed its recent 37% weekly surge with a 4% drop, dragging peers Advanced Micro Devices (AMD +7.92%) and Qualcomm (QCOM +6.14%) lower. With President Trump declaring the U.S.-Iran ceasefire on "massive life support," investors are bracing for a persistent energy-driven inflation story that could dominate the remainder of the year.

Geopolitical Premium Returns: Crude prices are pricing in a collapse of diplomatic talks after Tehran demanded full sovereignty over the Strait of Hormuz and billions in war reparations. Structural Inflation Risks: Analysts warn that two consecutive readings above 3% suggest price pressures are becoming entrenched, potentially forcing the Federal Reserve to maintain restrictive rates longer than anticipated. Market indexes

S&P 500

-0.37%

Nasdaq

-0.67%

Dow

-0.22%

Zebra Technologies Rides Automation Tailwinds 9:10 am -- ZBRA +13.5% in pre-market trading

By Jason Moser
Team Rule Breakers

Zebra Technologies (ZBRA +1.69%) reported encouraging first-quarter results with a 14.3% increase in net sales and non-GAAP earnings of $4.75 up better than 18%. The company demonstrated robust demand across both its Connected Frontline and Asset Visibility & Automation segments with segment sales up 21% and 7% respectively and there's no doubt the market is pleased with the fact that leadership raised guidance across the board. Zebra continues to benefit from tailwinds in e-commerce, automation, and physical AI, and we don't see those trends slowing down anytime soon.

GameStop's $56B eBay Bid 'Lacks Credibility' 8:30 am -- EBAY -0.95%, GME -2.37% in pre-market trading

eBay (EBAY +2.62%) has officially rejected a $56 billion unsolicited takeover bid from GameStop (GME 0.78%), dismissing the proposal as "neither credible nor attractive." The eBay board cited deep concerns over a massive funding gap and the high debt load required for the $125-per-share cash-and-stock deal. Despite CEO Ryan Cohen's $20 billion financing commitment from TD Bank (TD +1.49%) and a plan to use retail stores as fulfillment hubs, eBay leadership expressed full confidence in its current turnaround strategy under Jamie Iannone. The rejection follows a combative week of social media antics from Cohen, who even saw his personal eBay account suspended during the pursuit.

Financing Under Fire: Critics note that GameStop's $10 billion market cap makes acquiring a $48 billion giant nearly impossible without extreme equity dilution or "distressed-level" leverage. The Synergistic Stretch: While Cohen eyes live commerce and local authentication hubs, eBay's board countered that its focus on luxury goods and trading cards is already delivering superior shareholder returns.

Today's Change

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2.79

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$

109.20

This Morning's Breakfast News 7:30 am -- ONON +5.49% in pre-market trading

On Holding (ONON +2.42%) rose over 5% ahead of the opening bell after results showed record net sales and profitability, driven by a 44.4% revenue growth in the APAC region versus the previous year, as well as lifting its full-year profit outlook.

"Q1 was an outstanding start to the year and another strong proof point of our premium strategy in action": Casper Coppetti, founder and co-CEO, noted the push to being a premium brand, with the Stock Advisor recommendation by Team Rule Breakers projecting an impressive 64.5% gross profit margin by year end. "The business is doing fine": In late March, TMF chief investment officer Andy Cross explained, "even though they continue to put up some good numbers, they have some of the bigger headwinds from spending and tariffs and margins," but flagged the business had been "a long-term performer."

ICYMI: Monday's Scoreboard 6:45 am -- WSM +0.46% in pre-market trading

Williams-Sonoma (WSM +5.76%) was the subject of the latest Scoreboard video.

Sony's $4B Acquisition Signals Music IP Shift 6:00 am -- SONY +3.15%, BX -0.16% in pre-market trading

Sony Group (SONY +1.93%) has struck a massive $4 billion deal to acquire Recognition Music Group's catalog from Blackstone (BX +1.65%), securing the rights to over 45,000 iconic tracks. The acquisition, made through a joint venture with Singapore's GIC, includes legendary hits such as Leonard Cohen's "Hallelujah" and Journey's "Don't Stop Believin'," cementing Sony's position as a dominant force in the music intellectual property market. This exit follows Blackstone's 2024 takeover of Hipgnosis Songs Fund and marks a high-water point for music rights as an institutional asset class. As streaming continues to favor "legacy" catalogs with enduring replay value, Sony's aggressive deal-making highlights a strategic pivot toward owning evergreen content that provides stable, long-term cash flows.

Institutionalizing the Hits: This transaction validates music rights as a mainstream financial asset, offering Sony a high-margin revenue stream that remains resilient regardless of broader economic cycles. Streaming's Golden Oldies: With mature demographics driving consumption on major platforms, owning timeless classics allows Sony to capture a disproportionate share of global streaming royalties compared to riskier new releases.

Today's Change

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0.40

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21.16

Markel's Buyback Enough Without Spinoff 5:15 am -- MKL +0.18% in pre-market trading

By Buck Hartzell

Jana Partners has asked Markel's (MKL +1.27%) Board to spin off their Ventures businesses and do a tender offer for $2 billion worth of shares. Jana first voiced this back in 2024. While I agree that Markel is undervalued, Jana's requests are pure financial engineering. The reasons for Markel's underperformance are largely gone now (reinsurance, Poor Catco acquisition, and underinvestment in technology). Markel reduced their shares by about 10% over the past 5 years. The pace of repurchases will likely pick-up from here. That's enough for me but activists aren't often in it for the long haul.

Today's Change

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1.27

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23.11

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1844.05

Microsoft Caps OpenAI Payments Through 2030 5:00 am -- MSFT -0.41% in pre-market trading

The Information reports Microsoft (MSFT 1.82%) and OpenAI have agreed to cap revenue-sharing payments at $38 billion as details emerge of the renegotiated contract from last month, allowing OpenAI to have a stronger pitch to take on new investors.

Revenue-sharing will continue through to 2030: Even though the contract obligates payments for the coming years, the cap makes OpenAI more attractive when considering an IPO later this year, as it puts the company more in control of its finances. "It has worked out well because we took the risk": Microsoft CEO Satya Nadella said he was proud of the early investment in the business, with the initial $13 billion stake estimated to be worth $92 billion.

Today's Change

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-7.22

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$

390.14

Beazer Board Faces $25.75 Dream Finders Bid 4:30 am -- DFH -2.20%, BZH -2.53% in pre-market trading

By Buck Hartzell

Dream Finders Homes (DFH +3.60%) went public with their offer to purchase Beazer Homes (BZH +4.74%) for $25.75 per share in cash. This was a 40% premium to Beazer's current share price. Dream Finder's Founder and CEO Patrick Zalupski called out Beazer's suboptimal capital allocation strategy and lack of scale as solid reasons for the deal. DFH has proven to be a good home for the businesses they acquire. Dream Finders' asset light business model is built for the real estate cycles. The pressure is now on Beazer's board to respond to this very solid offer.

Today's Change

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0.52

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$

14.95

Before the Opening Bell 4:00 am

Stock futures are edging lower as Wall Street braces for April's Consumer Price Index (CPI) report, set against the backdrop of crumbling peace hopes in the Middle East. President Trump recently declared the U.S.-Iran ceasefire on "massive life support" after rejecting Tehran's latest proposal, a move that threatens to keep energy-driven inflation sticky. Economists expect headline CPI to land at 3.7%, a figure that will weigh heavily on the Federal Reserve's next interest rate decision. Despite the geopolitical friction, the S&P 500 and Nasdaq Composite closed at record highs Monday, buoyed by semiconductor strength and optimism surrounding the President's high-stakes state visit to China today. Trump is joined by a powerhouse delegation, including Tesla (TSLA +4.27%) CEO Elon Musk and Apple (AAPL +1.35%) chief Tim Cook, to negotiate new trade and AI frameworks.

The China "Mega-Mission": The presence of executives from BlackRock (BLK +0.46%) and Goldman Sachs (GS +2.89%) suggests the trip aims to reopen Chinese capital markets and secure high-performance computing supply chains amid ongoing U.S. technology restrictions. Stagflationary Shadows: While the labor market added a surprising 115,000 jobs in April, a 3.7% inflation print would likely force the Fed to maintain a "higher-for-longer" stance, delaying any potential rate cuts.

Have you been searching for a stock that might be well-positioned to maintain its earnings-beat streak in its upcoming report? It is worth considering Toronto-Dominion Bank (TD - Free Report) , which belongs to the Zacks Banks - Foreign industry.

This retail and wholesale bank has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for the past two quarters of 7.75%.

For the most recent quarter, Toronto-Dominion was expected to post earnings of $1.63 per share, but it reported $1.76 per share instead, representing a surprise of 7.98%. For the previous quarter, the consensus estimate was $1.46 per share, while it actually produced $1.57 per share, a surprise of 7.53%.

Price and EPS Surprise

Thanks in part to this history, there has been a favorable change in earnings estimates for Toronto-Dominion lately. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is positive, which is a great indicator of an earnings beat, particularly when combined with its solid Zacks Rank.

Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Toronto-Dominion has an Earnings ESP of +1.04% at the moment, suggesting that analysts have grown bullish on its near-term earnings potential. When you combine this positive Earnings ESP with the stock's Zacks Rank #3 (Hold), it shows that another beat is possibly around the corner. The company's next earnings report is expected to be released on May 28, 2026.

When the Earnings ESP comes up negative, investors should note that this will reduce the predictive power of the metric. But, a negative value is not indicative of a stock's earnings miss.

Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate.

Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

On May 26, 2026, we conducted a DCF analysis for The Toronto-Dominion Bank TD , which has shown impressive price performance over the past year, with a 73.2% increase. The current price stands at $111.87, reflecting a strong market presence.

DCF Earnings-based intrinsic value of $79.11 compared to the current price, indicating a margin of safety of -30.5% DCF FCF-based intrinsic value of $-48.05, suggesting a significantly overvalued status GF Score™ of 78/100, indicating a reliable assessment of the DCF inputs What Is TD Worth? DCF Earnings-Based Model The DCF earnings-based model for TD uses a two-stage approach to estimate intrinsic value. The first stage accounts for growth over the next ten years, while the second stage considers a terminal growth rate for the following ten years. Below are the key assumptions used in this analysis:

Parameter Value Current EPS (TTM, excl. non-recurring) $6.34 10-Year Growth Rate 6.2% 10-Year Treasury Rate 4.48% Discount Rate (ceil(Treasury) + 6%) 11% Terminal Growth Rate 4% In the first stage, we project the EPS growth at 6.2% per year for ten years, discounted at a rate of 11%. The calculated value for this growth stage is $50.13 per share. In the second stage, we apply a terminal growth rate of 4% for the next ten years, also discounted at 11%, yielding a terminal stage value of $28.98 per share. The summary of these calculations is as follows:

Stage Description Value Growth Stage (Years 1-10) EPS growing at 6.2%, discounted at 11% $50.13 Terminal Stage (Years 11-20) 4% terminal growth, discounted at 11% $28.98 Intrinsic Value Growth + Terminal $79.11 Comparing the current price of $111.87 with the intrinsic value of $79.11 indicates that TD is modestly overvalued, with a margin of safety of -30.5%. It is important to note that GuruFocus uses EPS excluding non-recurring items, as research shows that stock prices correlate more closely with earnings than with free cash flow. For a detailed calculation, visit the TD DCF Calculator.

What Does the Free Cash Flow DCF Say? When we consider the free cash flow (FCF) based DCF model, the intrinsic value calculated is $-48.05. This starkly contrasts with the earnings-based intrinsic value of $79.11, indicating a significant divergence between the two models. The FCF model suggests that TD is significantly overvalued, with a margin of safety of -100.0%.

How Does GF Value™ Compare to the DCF Models? The GF Value™ for TD is calculated at $76.07, providing a third perspective on valuation. GF Value™ is GuruFocus' proprietary measure derived from historical trading multiples, past business growth, and future performance estimates. All three models—DCF earnings, DCF FCF, and GF Value™—suggest that TD is overvalued, reinforcing the caution for potential investors. For more insights, visit the GF Value™ page.

What Does TD's GF Score™ Tell Us? The GF Score™ ranks stocks from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have been found to generate higher long-term returns (backtested 2006-2021).

Metric Rating GF Score™ 78/100 Financial Strength 2/10 Profitability 6/10 Growth 9/10 Valuation 5/10 Momentum 9/10 The predictability rank for TD is 3/5 stars, indicating that the DCF model is relatively reliable for this stock. For more information, visit the TD stock page.

Key Assumptions and Limitations It is essential to recognize that DCF models are highly sensitive to the assumptions made regarding growth rates and discount rates. Additionally, stocks with lower predictability ratings tend to produce less reliable DCF estimates. The terminal growth rate of 4% used in this analysis is a simplifying assumption that may not reflect future market conditions accurately.

What This Means for Investors In synthesizing the findings from the DCF earnings model, the DCF FCF model, and the GF Value™, the clear verdict is that TD is overvalued based on the current market price compared to the intrinsic values derived from these models.

For the full DCF analysis, visit the TD DCF Calculator. You can also explore the GF Value™ page, or use the GuruFocus Stock Screener to find undervalued predictable companies.

Frequently Asked Questions What is TD's intrinsic value based on DCF?

[Answer: earnings-based $85.73, FCF-based $-48.05]

Is TD overvalued or undervalued?

[Answer using DCF + GF Value™ consensus]

How reliable is the DCF model for TD?

[Answer using predictability rank 3/5]

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Soft economic conditions and greater uncertainty will take the spotlight as banks report earnings, shifting focus to credit-loss provisions.

Airplane Maintenance Companies That Keep Flights Moving Are Ready to SoarToronto Dominion Bank NYSE: TD, which operates as TD Bank Group, reported what executives described as a strong second quarter for fiscal 2026, driven by revenue growth across several businesses, margin expansion, expense discipline and stable credit performance.

Chief Executive Officer Raymond Chun said adjusted earnings per share rose 21% from a year earlier, while return on equity increased more than 200 basis points to 14.4%. Chun said the bank is “on track to outperform” its fiscal 2026 targets of 6% to 8% EPS growth and 13% ROE, assuming current macroeconomic conditions continue.

Get Toronto Dominion Bank alerts:

Peloton Stock Is Rallying, But Can It Deliver Another 70% Upside?The bank also announced a CAD 0.04 increase to its dividend, bringing the quarterly payout to CAD 1.12 per share. Chun said the increase reflected management’s confidence in TD’s “future growth and earnings power.”

Revenue Momentum Across Core Businesses Chun said Canadian Personal and Commercial Banking delivered record second-quarter revenue, pre-tax pre-provision earnings and earnings. Real estate secured lending volumes rose 5% year over year, while business banking loans increased 7%, supported by distribution expansion and broad-based momentum. He said Canadian clients “continue to demonstrate resilience through macroeconomic uncertainty.”

3 Robotics Stocks Animating Markets With Ample Upside to GoChief Financial Officer Kelvin Tran said average deposits in Canadian Personal and Commercial Banking rose 3% year over year, including 1% growth in personal deposits and 5% growth in business deposits. Average loan volumes increased 6%, with 5% growth in personal loans and 7% growth in business loans. Net interest margin in the segment was up two basis points sequentially and is expected to remain relatively stable in the third quarter, based on current rate and competitive dynamics.

In U.S. Banking, Tran said earnings rose 12% year over year and return on tangible common equity expanded by more than 200 basis points to 14.8%. Core loans grew 3% year over year, while new bank card account acquisition rose 32%. TD Auto Finance delivered record second-quarter originations, and middle market lending commitments increased 17% year over year.

U.S. Banking net interest margin was 3.41%, up three basis points from the prior quarter, driven by higher loan and deposit margins. Tran said the bank expects U.S. Banking margin to modestly increase in the third quarter. He also reaffirmed guidance for approximately $2.9 billion in net income for the U.S. Banking segment in fiscal 2026.

AML Remediation Remains a Priority in U.S. Banking Leo Salom, Group Head of U.S. Banking, said anti-money laundering remediation remains the top priority for the U.S. business. He said a third-party vendor completed its first population of look-back reviews required under the OCC and FinCEN consent orders, though additional work remains.

Salom said TD’s AML program is now operating on a new transaction monitoring system with embedded machine learning and AI enhancements. The bank has also deployed a new know-your-customer strategic platform and embedded an improved customer risk rating model to support more timely and consistent risk assessments.

From a financial standpoint, Salom said AML remediation spending is beginning to shift toward validation and sustainability costs, while implementation expenses have started to moderate. He said overall AML remediation costs are expected to decline in the second half of the year, broadly in line with previous guidance of CAD 500 million for fiscal 2026.

Cost Cuts and AI Investments Ahead of Pace TD executives emphasized structural cost reductions and artificial intelligence as central elements of the bank’s strategy. Chun said TD is tracking ahead of its Investor Day targets to remove CAD 2 billion to CAD 2.5 billion in structural costs and generate CAD 1 billion in annualized value from AI over the medium term.

Chun said the bank has already achieved its fiscal 2026 goal of CAD 900 million in structural cost reductions. TD has also delivered nearly CAD 145 million in value from predictive, generative and agentic AI use cases so far this year, ahead of its CAD 200 million target for fiscal 2026.

Examples cited by Chun included reducing mortgage pre-adjudication cycle time in real estate secured lending from approximately 15 hours to three minutes using agentic AI. He also said TD became the first home and auto insurer in Canada to launch a client-facing generative AI virtual assistant. Across the bank, more than 40,000 employees are using Copilot, and more than 7,000 engineers are using AI for software development.

Tran said total expenses increased 5% year over year, with about 2% of that increase tied to variable compensation, foreign exchange and the impact of the U.S. Strategic Cards portfolio. TD delivered its fourth consecutive quarter of positive operating leverage. Chun said the bank remains confident in its enterprise expense growth target of 3% to 4% for fiscal 2026, excluding certain effects.

Credit Performance Stable, With Reserves Reflecting Macro Risks Chief Risk Officer Ajai Bambawale said TD exhibited “continued strong credit performance” in the quarter. Gross impaired loan formations declined five basis points, or CAD 457 million, from the prior quarter to 22 basis points. Gross impaired loans fell four basis points sequentially to 54 basis points.

The bank’s provision for credit losses was 43 basis points, flat quarter over quarter and within TD’s guided range. Impaired provisions for credit losses were CAD 973 million, down CAD 191 million from the prior quarter. The bank recorded a performing provision of CAD 28 million, largely related to an updated macroeconomic outlook.

Bambawale said TD continues to expect fiscal 2026 provisions for credit losses to be in the range of 40 to 50 basis points. He noted that the bank has close to CAD 500 million in reserves related to trade and tariffs, most of which remains unused. He also said TD added some performing reserves to reflect deterioration in the economic outlook and uncertainty related to the Middle East conflict.

On the Canadian consumer, Bambawale said household debt remains high, but consumers have been resilient due to lower rates, improved wealth levels relative to the pre-pandemic period, wage growth and government support. He said TD is seeing some migration in the under-650 credit score segment, including in residential lending, auto and cards, but characterized overall credit as “still in good shape.”

Capital Returns and Segment Records TD ended the quarter with a Common Equity Tier 1 ratio of 14.3%, down 26 basis points sequentially. Tran said the bank generated strong organic capital during the quarter, partly offset by the repurchase of approximately 19 million common shares, which reduced CET1 by 41 basis points.

Chun said TD remains committed to completing its CAD 7 billion share buyback program. Tran said that, together with a previous buyback, completion of the program would bring total capital returned to shareholders to CAD 15 billion.

Wealth Management and Insurance delivered record earnings and assets, while Wholesale Banking also posted record earnings, supported by strong client activity in global markets and corporate and investment banking. Tran said Wholesale Banking’s return on equity improved 360 basis points year over year to 14.5%.

In closing remarks, Chun said TD continued its momentum in the first half of fiscal 2026 with “strong credit performance, positive operating leverage, and robust earnings growth.”

About Toronto Dominion Bank NYSE: TDToronto-Dominion Bank (TD) is a Canadian multinational banking and financial services company headquartered in Toronto, Ontario. Formed through the 1955 merger of the Bank of Toronto (founded 1855) and the Dominion Bank (founded 1869), TD is one of Canada's largest banks and offers a broad range of financial products and services to individual, small business, commercial and institutional clients.

TD's core businesses include Canadian and U.S. personal and commercial banking, wealth management, wholesale banking and insurance.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

Should You Invest $1,000 in Toronto Dominion Bank Right Now?Before you consider Toronto Dominion Bank, you'll want to hear this.

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The Toronto-Dominion Bank delivered strong Q2 results, beating revenue and EPS estimates with record earnings and robust profitability metrics. Despite recent AML-related fines and higher valuation multiples, TD maintains a healthy balance sheet, high ROE, and strong efficiency, supporting continued earnings growth. Management projects mid-single-digit expense growth, $500M AML remediation costs in 2026, $2.9B U.S. net income, and plans to complete a $7B buyback.

Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.

Cash flow can come from bond interest, interest from other types of investments, and, of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.

Headquartered in Toronto, Toronto-Dominion Bank (TD - Free Report) is a Finance stock that has seen a price change of 21.55% so far this year. Currently paying a dividend of $0.78 per share, the company has a dividend yield of 2.71%. In comparison, the Banks - Foreign industry's yield is 2.75%, while the S&P 500's yield is 1.46%.

Looking at dividend growth, the company's current annualized dividend of $3.11 is up 4.2% from last year. Over the last 5 years, Toronto-Dominion Bank has increased its dividend 3 times on a year-over-year basis for an average annual increase of 5.24%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Toronto-Dominion's current payout ratio is 45%, meaning it paid out 45% of its trailing 12-month EPS as dividend.

Looking at this fiscal year, TD expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $6.92 per share, representing a year-over-year earnings growth rate of 15.72%.

Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer a quarterly payout.

Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, TD is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of #3 (Hold).