Should You Buy Toronto-Dominion Bank or Royal Bank of Canada Right Now?

Toronto-Dominion Bank (TSX:TD)(NYSE:TD) and Royal Bank of Canada (TSX:RY)(NYSE:RY) are normally the first names investors turn to when looking for Canadian bank exposure.

For the past six years Canadian banks have been a smart bet, but the oil rout continues to send shockwaves through the Canadian economy, and fears of a recession are mounting. The worst-case scenario calls for a dramatic rise in unemployment and a meltdown in the housing market.

That doesn’t sound like an inviting environment for bank investors, and the shares of the Big Five have been under pressure in recent weeks.

Let’s take a look at Toronto-Dominion Bank and Royal Bank of Canada to see if you should consider adding them to your portfolio after the recent pullback.

Toronto-Dominion Bank

TD operates a very strong Canadian retail operation. It delivered year-over-year Q2 2015 adjusted net income growth of 6%, a solid number given the difficult environment facing the banks.

As the Canadian economy heads into a rough patch, TD’s US operations should help balance out the revenue stream. Over the past decade the company has invested $17 billion to build its US presence and now has more than 1,300 branches running from Maine right down to Florida. Last year CEO Bharat Masrani said TD now has the scale it needs to compete in the US market.

The timing looks pretty good as the US economy continues to improve and TD is getting a nice earnings boost from the stronger American dollar.

The company is undergoing a comprehensive review of its operations and recently announced a $228 million restructuring charge. Most of the costs will be tied to changes in the US group as the company transitions from a growth strategy to one focused on improving efficiency and profitability. Investors should see the benefits start to show up at the end of this year.

TD pays a dividend of $2.04 per share that yields about 3.9%. The company recently increased the payout by 9%.

Just $3.8 billion, or 1% of the companys loans, is connected to the oil and gas sector.

Royal Bank

In Q2 2015 Royal delivered record adjusted net income of $2.4 billion, a 9% jump over the same period a year ago.

The company gets about 51% of its earnings from personal and commercial banking activities. Capital markets bring in 24%, wealth management contributes 11%, and the company’s insurance group recently kicked in 8% of profits. Investor and treasury services make up the rest.

The company is betting big on US wealth management with a US$5.4 billion deal to acquire California-based City National Corp. The purchase provides Royal with a good platform to expand its asset-management operations south of the border.

Royal also increased its dividend this year and now pays $3.08 per share that yields about 4%.

About 1.5% of Royals total loan book is exposed to the oil and gas sector, and Alberta represents about 15% of its mortgage portfolio.

Should You Buy TD or Royal?

Both banks are currently trading at an attractive 11 times forward earnings. TD relies less on capital markets, which can be quite volatile, so it might be the more conservative pick. Nonetheless, investors with a long-term outlook should be comfortable holding either stock at this point.

Amid financial problems, Sitka dissolves board of city-owned hospital – KTOO

The Sitka Assembly voted Tuesday to dissolve the board of the city-owned Sitka Community Hospital.

The vote came in the aftermath of the hospital’s financial crisis this winter, when the city had to extend an emergency $1 million loan to keep Sitka Community afloat.

Deputy Mayor Matt Hunter said that looking back over the past decade and a half the city has faced similar issues nearly every other year.

“The city has been startled by crises … seven times here,” Hunter said. “In September 2001, the city gave a million-dollar short-term loan — in September 2002, an additional $300,000. In April 2004, another $250,000 line of credit … in 2006 and 2007, interest and loans were written off…In 2009, a $500,000 line of   credit. And then in December 2014, (which) was increased to $1.5 million with an additional million.”

Meanwhile, this spring, the assembly voted to double the tobacco tax to provide the hospital with an additional cash infusion.

Hunter argued that Sitka Community needs closer city oversight and a board that’s better qualified to handle its complex finances. A new proposal would reduce the board from seven voting members to five, and require that at least one member have professional financial experience. It would also include a member of city staff appointed by the city administrator, Mark Gorman, to give the city more say in hospital decisions.

But Ann Wilkinson, who took over as board president this spring, said the current board has been blindsided.

“We had heard that the Assembly was concerned about the board’s ability to handle the finances of the hospital, and we were told we would probably all be asked to quit,” Wilkinson said. “But that didn’t happen – for months that didn’t happen. And then suddenly Mr. Gorman tells me, ‘Well, we’re going to restructure the board and you’re all going to be out.’ They hadn’t told us this, or asked us any questions. They just decided – and I don’t know who decided that.”

The proposal passed 6-1 on first reading, with Steven Eisenbeisz  voting no. It will have to pass at least once more to go into effect.



Corelogic Upgraded by Zacks to Buy (CLGX)

Zacks upgraded shares of Corelogic (NASDAQ:CLGX) from a hold rating to a buy rating in a research note released on Tuesday morning, reports. They currently have $47.00 target price on the stock.

According to Zacks, CoreLogic, Inc., formerly known as First American Corp., is a provider of consumer, financial and property information, analytics and services to business and government. The Company combines public, contributory and proprietary data to develop predictive decision analytics and provide business services. CoreLogic has built databases for US real estate, mortgage application, fraud, and loan performance and is also a provider of mortgage and automotive credit reporting, property tax, valuation, flood determination, and geospatial analytics and services. The Company serves various industries, including automotive, cable, financial services, employment, geospatial information service, insurance, legal, oil and gas, real estate, retail, utility, and telecommunications. CoreLogic, Inc. is headquartered in Santa Ana, California.

Zacks has also modified their ratings on a number of other information technology stocks in the few days. The firm downgraded shares of International Business Machines Corp. from a buy rating to a hold rating. Also, Zacks upgraded shares of Higher One Holdings, Inc from a sell rating to a hold rating. Finally, Zacks upgraded shares of Gartner Inc from a hold rating to a strong-buy rating. Zacks now has a $99.00 price target on that stock.

Other equities research analysts have also recently issued reports about the stock. Analysts at Stephens upgraded shares of Corelogic from an equal weight rating to an overweight rating and raised their price target for the stock from $43.00 to $47.00 in a research note on Tuesday, June 30th. Analysts at Macquarie downgraded shares of Corelogic from a neutral rating to an underperform rating in a research note on Wednesday, June 17th. Analysts at Piper Jaffray set a $46.00 price target on shares of Corelogic and gave the company a buy rating in a research note on Wednesday, May 20th. Analysts at Oppenheimer reiterated an outperform rating and set a $45.00 price target on shares of Corelogic in a research note on Wednesday, May 20th. Finally, analysts at William Blair reiterated an outperform rating on shares of Corelogic in a research note on Tuesday, April 28th. One investment analyst has rated the stock with a sell rating, one has assigned a hold rating and eight have given a buy rating to the stock. The stock has an average rating of Buy and a consensus target price of $42.71.

Corelogic (NASDAQ:CLGX) traded up 0.12% on Tuesday, hitting $41.69. The stock had a trading volume of 113,116 shares. Corelogic has a 52 week low of $25.54 and a 52 week high of $41.86. The stock’s 50-day moving average is $39.20 and its 200-day moving average is $36.17. The company has a market cap of $3.76 billion and a P/E ratio of 36.83.

Corelogic (NASDAQ:CLGX) last announced its earnings results on Wednesday, April 22nd. The company reported $0.46 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.31 by $0.15. The company had revenue of $364.80 million for the quarter, compared to the consensus estimate of $356.53 million. During the same quarter in the previous year, the company posted $0.18 earnings per share. The company’s revenue for the quarter was up 11.9% on a year-over-year basis. On average, analysts predict that Corelogic will post $1.79 earnings per share for the current fiscal year.

In other Corelogic news, EVP Barry M. Sando sold 95,526 shares of the company’s stock in a transaction dated Monday, May 18th. The shares were sold at an average price of $39.60, for a total value of $3,782,829.60. The sale was disclosed in a filing with the SEC, which is available at this link. Also, Director Mary Lee Widener sold 1,500 shares of the company’s stock in a transaction dated Monday, May 4th. The stock was sold at an average price of $39.50, for a total transaction of $59,250.00. The disclosure for this sale can be found here.

CoreLogic, Inc. (NASDAQ:CLGX) is a residential property information, analytics and services provider in the United States, Australia and New Zealand. The Company serves real estate and mortgage finance, insurance, capital markets, transportation and government. The Company offers its services through unique data, analytics, workflow technology, advisory and managed services. The Company operates through two segments: Data and Analytics (D#038;A) and Technology and Processing Solutions (TPS). The Data and Analytics segment’s key products and services are Property information and analytics, Insurance and spatial solutions and Multifamily and specialty services. The Technology and Processing Solutions offers Property tax processing (residential and commercial), Origination and underwriting services (credit, verification and flood) and Technology and Outsourcing solutions.

To get a free copy of the research report on Corelogic (CLGX), click here. For more information about research offerings from Zacks Investment Research, visit

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Moody’s downgrades Emeco’s rating to Caa1; outlook negative

Sydney, July 31, 2015 — Moodys Investors Service has downgraded Emeco Holdings Limiteds (Emeco)
Corporate Family Rating (CFR) to Caa1 from B3. At the same time,
Emeco Pty Limiteds senior secured rating was downgraded to Caa1 from
B3. The outlook on all the ratings is negative.


The rating downgrade reflects the continued significant weakness in key
commodity prices and our expectation that operating conditions for mining
services companies like Emeco will remain weak through 2016. Mining
companies will continue to focus on cost saving programs and the deferral
of non-essential capital expenditure, increasing uncertainty
around Emecos ability to improve earnings and to reduce debt,
says Saranga Ranasinghe, a Moodys Analyst.

Prices of coal, copper and oil, which are key products for
Emeco, are trading at very weak levels due to poor fundamentals.
Consequently, Moodys does not expect any material improvement in
the near term. Consequently, Moodys expects mining
companies to continue to exert price pressure on mining services companies.

Despite the increase in Emecos utilization levels to 75%
from around 50% in June 2014, we expect its margins and earnings
to remain pressured in the next 12-18 months reflecting the competitive
environment and the pressure exerted by miners as they try to reduce their
own cost bases. As such, we do not expect Emecos higher
utilization levels to generate sufficient profitability for the company
to improve its leverage to level consistent with its previous B3 rating

We expect Emecos credit metrics to remain pressured over the next 12-18
months, with a ratio of debt-to-EBITDA between 8x-9x,
adds Ranasinghe.

The negative outlook reflects these concerns and Moodys view that
there could be risk to the downside as a consequence of the potential
for contract deferrals and/or cancellations.

Emecos rating acknowledges the firms ability to reduce operating
costs and capital spending on its rental fleet during periods of declining
utilization, as well as the companys ability to dispose of unutilized
equipment to right-size its rental fleet and supplement operating
cash flow.

Moodys expects Emeco to maintain sufficient liquidity over the next 12
months, supported by its cash balances, undrawn credit facilities
and reduced capital expenditure.


The rating could face further negative pressure if the challenging market
conditions deteriorate beyond our current expectations, further
hindering Emecos revenue and earnings generation ability, and leading
to Debt/EBITDA ratio exceeding 15x on a consistent basis. At the
same time, the rating could also be downgraded further if the liquidity
buffer diminishes at a pace that is not consistent with our expectations,
hindering the companys ability to cover debt service obligations.

The outlook could revert to stable if Emeco secures new contracts and
increases revenue and earnings, such that gross adjusted debt-to-EBITDA
remains comfortably below 6.5x on a consistent basis.

The principal methodology used in these ratings was Equipment and Transportation
Rental Industry published in December 2014. Please see the Credit
Policy page on for a copy of this methodology.

Emeco Holdings Limited (Emeco), established in 1972 and based in
Perth Australia, is a mining equipment rental company.


For ratings issued on a program, series or category/class of debt,
this announcement provides certain regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moodys
rating practices. For ratings issued on a support provider,
this announcement provides certain regulatory disclosures in relation
to the rating action on the support provider and in relation to each particular
rating action for securities that derive their credit ratings from the
support providers credit rating. For provisional ratings,
this announcement provides certain regulatory disclosures in relation
to the provisional rating assigned, and in relation to a definitive
rating that may be assigned subsequent to the final issuance of the debt,
in each case where the transaction structure and terms have not changed
prior to the assignment of the definitive rating in a manner that would
have affected the rating. For further information please see the
ratings tab on the issuer/entity page for the respective issuer on

For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this rating action, and
whose ratings may change as a result of this rating action, the
associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating

Please see for any updates on changes to
the lead rating analyst and to the Moodys legal entity that has issued
the rating.

Please see the ratings tab on the issuer/entity page on
for additional regulatory disclosures for each credit rating.

Saranga Ranasinghe
Corporate Finance Group
Moodys Investors Service Pty. Ltd.
Level 10
1 OConnell Street
Sydney NSW 2000
JOURNALISTS: (612) 9270-8102
SUBSCRIBERS: (852) 3551-3077

Patrick Winsbury
Associate Managing Director
Corporate Finance Group
JOURNALISTS: (612) 9270-8102
SUBSCRIBERS: (852) 3551-3077

Releasing Office:
Moodys Investors Service Pty. Ltd.
Level 10
1 OConnell Street
Sydney NSW 2000
JOURNALISTS: (612) 9270-8102
SUBSCRIBERS: (852) 3551-3077

Protect Your Retirement from the Artful Dodger: How to Avoid Financial Cons …

NEW YORK ( MainStreet) — Choosing afinancial advisor is one of the most important decisions an investor can make. Good judgement can make the difference between a retirement spent traveling around the world and anxious weeks between Social Security checks, so competence is a big must.

Not investing in is just one step,though. A good financial advisor also needs to be honest, because trusting your retirement plan to a crook can be nothing short of devastating.

Financial fraud is nothing new; from bogus IRS collection schemes to sweepstakes scams, financial scams costthe elderly alone nearly $36.5 billion per year. Most cons rely on a little bit of distance between predator and prey, though, generally with a volume approach to finding victims. As a result, people are inclined to trust someone they meet in person.

Loan market a mainstay amid China, Greece uncertainty

Twists and turns in the global macroeconomic landscape could turn out to have mixed results for Asian loan syndications, reckon market participants. One event that has captured the attention of bankers is how Asian bond market investors are going to react to the issue of Greece’s looming bankruptcy and its uncertain future in the eurozone.

“There is a lot of concern among my ECM and DCM colleagues but the loan market remains characteristically resilient and reliable,” said one senior loan syndicator based in Hong Kong.

“If something very big happens or the Greek situation deteriorates significantly, we could see bond and equity players look for other avenues for fundraising. There, if you have a stable and solid loan market, there could be a shift to it.”

There are no clear indications of such a shift yet but property company loans from China are trickling back into the market. For example, China and Hong Kong high-end property developer HKR International launched a HK$4.8bn loan into general on Monday. The company is paying an all-in of 146bp for commitments of HK$350m or over.

Chinese property developer Country Garden is also in the market for a $400m refinancing. A banker familiar with that situation said select companies in the Chinese property sector could take the syndicated loan route versus bonds as there would be a cost saving for them.

Better known property names also want to extend relationships with banks both onshore and offshore, which could be another motivation for going to the international syndicated loan market, he said.

Ying Li International Real Estate, for instance, tapped both the onshore and offshore syndicated loans market at one go with a $135m deal that was signed on June 17.

The transaction consisted of a Rmb460m onshore tranche and a S$80m offshore tranche, both of which were 30-month term loans.

Separately, the huge swings in China’s onshore stocks are also making some bankers nervous.

“It’s not so much that the markets are down but the huge fluctuations that are giving me a headache,” said a second loans syndication banker. He said this was because those indices that had gained 150% have now receded about 30%, meaning markets were still up by 70%-80%.

“One company we lend to, I will not name, was down 12% yesterday and up 15% today. What do you make of that? All your credit assumptions appear shaky.”

However, several bankers indicated their eagerness to see more activity out of Greater China, volatility notwithstanding. Others said the effect of these movements was likely to be minimal.

“This will have some effect on brokers’ stocks but there will be support by the government so we are not that concerned about it,” said a leveraged finance banker.

  • By Shruti Chaturvedi
  • 09 Jul 2015

Hundreds of retired DC employees face financial ruin over decades-old …

WASHINGTON (WJLA) – A retired DC firefighter and Army veteran has found himself on the brink of financial collapse for a mistake that wasnt his fault. For the past two decades the Treasury Department miscalculated his retirement and now hes the one being held accountable.

Imagine getting a letter in the mail saying you owe the feds nearly $27,000 because of an accounting error made decades ago that you knew nothing about. Thats exactly what happened to hundreds of retired DC employees. And if something isnt done soon their lives coud to drastically change.

For Charles Beale, of Fort Washington, nothing is more important than his seven children and 18 grandchildren.

“My wife and I, we are the pillars of our family, remarked Beale.

But the financial stability of that pillar is being threatened. Two months ago, this retired DC fire fighter received a letter from the US Treasury saying an administrative error had been discovered. For the past 20 years, the retirement annuity he built his familys life around was wrong.

I almost fell out of my chair,” exclaimed Beale.

The letter informed Beale his annuity would be adjusted down. And, the 68-year-old would have to pay back the overpayment of $26,558.

This is almost forcing families to fail,” Beale stated. It was not my fault. I had no knowledge of it.

The I-Team has learned this administrative error affects 570 retired DC fire fighters, police officers and teachers – some, with overpayments of $60,000. The mistake was made when the employees retired, which in Beales case was in 1995.

“For them to be held responsible for that all these years later – its absurd. Ed Smith, the president of the DC Fire Fighters Association, has stepped in, but options are limited.

7 On Your Side reached out to the US Treasury Department for an explanation. We were told retirees can appeal the overpayment, which Beale has done. Now, he waits – with his familys financial future resting in the hands of someone inside a government building.

“They have the authority to wave the back money. And they should,” added Smith.

On August 1, if nothing changes, Beale must begin repaying that money – at $670 a month for three years. Combined with his already adjusted annuity and his family is out $800 a month.

If I fail, everything below me fails,” said Beale. Its much bigger than $800 a month. And it would be devastating in the pillar crumbling.

Some states have statues of limitations for this type of government accounting error. The US Treasury does not.

Either way, Beale, who spent 27 years as a fire fighter, said he doesnt mind refunding the money, as long as he can pay it back the way he got it, at $100 a month for 20 years.

Featured Artists Coalition criticises Sony over Spotify deal

Last week, court papers from Sony Music’s court battle with 19 Entertainment over streaming deals revealed part of the major label’s defence against claims it willingly lessened artist income by accepting lower royalty rates in return for equity and advertising income.

The defence, which has been sparking debate ever since, was that Sony could “act on its own interests in a way that may incidentally lessen the other party’s anticipated fruits from the contract” including keeping revenues paid “on a general or label basis”.

Now the Featured Artists Coalition has weighed in to the row with some pointed criticism of Sony, saying the court documents “proves our long held fear: artists’ royalties have clearly been rendered all but value-less by the deals the major record labels have done with digital providers”.

FAC went on to claim that “It would appear that in this instance, Sony chose to ignore artists’ interests in favour of their own corporate ones. It’s extraordinary that Sony is prepared to defend their conduct in court by saying they believe it is their legal right to do so.”

In FAC’s view “the breach of moral trust that has long been felt amongst artists is now in the public domain and on the record”, which it sees as backing its call for legislators to step in and take action over these digital deals.

Yet in recent months, all three major labels have been competing to sound most artist-friendly over their policies on digital breakage money, advances and equity stakes. The disparity between these public protests and the previously-private court filings will only fuel the long-running but increasingly-heated debate about transparency within the digital music ecosystem.

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