Toronto Dominion Bank (TD:CA) is now facing a class action lawsuit spearheaded by the renowned firm, Bronstein, Gewirtz & Grossman, LLC. The allegations center on considerable and undisclosed risks that TD investors were subject to during 2024, leading to unprecedented losses. But what does this indicate for the Bank’s future? Here’s our analysis.
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What Are the Lawsuit’s Allegations?
The class action lawsuit against TD and its specific officers targets alleged violations of federal securities laws spanning February 29, 2024, to October 9, 2024. TD is under scrutiny for allegedly making false and misleading statements and concealing material facts about its Anti-Money Laundering (AML) program’s true state. Revelations from U.S. investigations on October 10, 2024, precipitated a dramatic decline in TD’s common stock.
Investors with losses up until December 23, 2024, are eligible to request appointment as the lead plaintiff. Behind them is Bronstein, Gewirtz & Grossman, LLC, a firm with a solid reputation for representing investors embroiled in securities fraud class actions and shareholder derivative lawsuits.
What Does Stock Target Advisor Say about TD?
From an analytical perspective, Stock Target Advisor’s assessment of TD reflects a “Strong Sell” rating. With a 12-month target price of $64, it suggests a projected price change of 22.49%. This stands opposed to the average analyst target price, deemed to be $68.33 over the next year, with an overarching “Strong Buy” rating.
TD’s superior revenue growth serves as a beacon of strength, albeit being overshadowed by negative factors such as subpar total returns, high volatility, weak risk-adjusted returns, and lagging dividend growth.
Where Does TD Stand amongst Market Analysts?
TD’s standing amongst market analysts is split. A coverage by two analysts awards TD a “Strong Buy” average rating. The Average Analyst target price is $68.33, with highest forecasts reaching $77 and lowest pegging at $64.
The Banks – Diversified sector on the New York Exchange (NYE) generally enjoys a “Strong Buy” average analyst rating, whereas Stock Target Advisor inclines towards a “Slightly Bearish” stance.
Over the past month, stocks in the sector have faced a -2.02% average return. Notable players in the sector include BAC, MUFG, UBS, SMFG, and BMO, with top ranked analysts coming from National Bank Financial, Scotia Capital, Morningstar, CIBC World Markets, and Desjardins Securities.
Conclusion:
Looming legal challenges bring periods of uncertainty, as is currently the case for TD. However, a comprehensive understanding of the Bank’s standing within its industry sector, financial performance, and growth trajectory can position investors, both new and seasoned, to formulate an informed reaction to ongoing developments.
Muzzammil is a content writer at Stock Target Advisor. He has been writing stock news and analysis at Stock Target Advisor since 2023 and has worked in the financial domain in various roles since 2020. He has previously worked on an equity research firm that analyzed companies listed on the stock markets in the U.S. and Canada and performed fundamental and qualitative analyses of management strength, business strategy, and product/services forecast as indicated by major brokers covering the stock.
