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Should You Buy Royal Bank After Q1 Earnings?

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Feb 26, 2021 (Baystreet.ca via COMTEX) -- The Big Six Canadian banks have stepped up to release their first batch of 2021 results in late February and going into early March. Royal Bank /zigman2/quotes/200638870/delayed CA:RY +1.12% /zigman2/quotes/206088494/composite RY +0.92% is the largest financial institution in Canada and the largest stock on the TSX by market capitalization. Its shares have climbed 6.1% year-over-year as of close on February 25.

Royal Bank unveiled its first-quarter 2021 results on February 24. It delivered a strong quarter on the back of higher trading fees and lower loan-loss provisions. The bank's net income increased 10% from the prior year to $3.8 billion. Meanwhile, diluted earnings per share climbed 11% to $2.66. Investors should be encouraged by its results in the face of the lingering COVID-19 crisis.

Personal and Commercial Banking net income rose 6% year-over-year to $1.79 billion. It achieved this increase on the back of average volume growth of 12%. Net income also climbed 19% from the previous quarter. Royal Bank's Capital Markets segment achieved record net income of $1.06 billion - up 21% from the prior year. The segment was powered by higher equity trading primarily in the United States. Net income in its Capital Markets division rose 27% from Q4 2020.

Shares of Royal Bank fell 1.3% in trading on February 25. Investors should beware as bank stock valuations are high and volatility is picking up. Still, Royal Bank stock possesses a favourable price-to-earnings ratio of 13. It offers a quarterly dividend of $1.08 per share. That represents a 3.9% yield.


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CA : Canada: Toronto
$ 148.94
+1.65 +1.12%
Volume: 412,499
Jan. 17, 2022 10:32a
P/E Ratio
Dividend Yield
Market Cap
$209.84 billion
Rev. per Employee
$ 117.33
+1.07 +0.92%
Volume: 1.66M
Jan. 14, 2022 4:00p
P/E Ratio
Dividend Yield
Market Cap
$167.28 billion
Rev. per Employee

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