TD Bank Stock (NYSE:TD) At Multi-Year Highs Into Earnings: What To Expect

Toronto-Dominion Bank (NYSE:TD) heads into this mornings pre-market earnings with its stock trading at three year highs.

EPS is expected to come in at $2.03, a mild drop on the $2.05 seen during the same period Y/Y, yet a step up on the $1.97 hit during the most recent quarter. Revenue is also projected to have narrowed 3.73% to $13.71billion.

TD's current price of $77 reflects a 1.13% pre-market gain, adding to the 1.2% uplift seen during yesterday's session would reflect a new high bar for the stock. Technical indicators also paint a positive picture. The 50-day simple moving average (SMA) stands at $71.27, and the 200-day SMA is at $61.12, with the stock trading higher than both a bullish sign.

TD's strong Q2 2025 results have fueled much of this optimism. The bank reported earnings per share (EPS) of $1.97, exceeding analyst expectations of $1.83. Revenue also surpassed forecasts, reaching $15.1 billion against an expected $13.61 billion, a 9% year-over-year increase.

This growth was primarily driven by robust performance in its markets-driven businesses (higher fee income) and increased volumes and deposit margins within its Canadian Personal and Commercial Banking segment. Furthermore, TD's Common Equity Tier One (CET1) ratio of 14.9% indicates a solid capital position, and the repurchase of 30 million shares underscores its commitment to enhancing shareholder value.

However, TD faces significant challenges, particularly concerning anti-money laundering (AML) compliance within its U.S. Retail Banking operations.

The bank has allocated a substantial $2.6 billion provision for AML investigations, in addition to a $450 million provision from the previous quarter. CEO Raymond Chun has emphasized the bank's dedication to rectifying these issues, outlining a remediation plan that includes hiring specialists, investing in advanced technology, and implementing revised procedures.

The success of this remediation will be critical in regaining investor trust and avoiding further regulatory scrutiny.

TD is also actively pursuing strategic restructuring to improve operational efficiency. The bank has initiated a restructuring program projected to incur charges between $600 million and $700 million, but is expected to yield annual savings of approximately $550 million to $650 million once fully implemented.

Additionally, TD has divested approximately $9 billion in correspondent loans and plans to discontinue its U.S. point-of-sale financing business, focusing instead on its proprietary bank card business. These strategic moves aim to enhance the U.S. retail return on equity and streamline overall operations.