Royal Bank (TSX:RY)(NYSE:RY) is the largest financial institution in Canada and the largest TSX stock by market cap. Shares of this bank stock have climbed 1.9% in 2022 as of early afternoon trading on February 28. The stock is up 27% year over year.
Canadian banks put together a banner year in 2021 on the back of a broader rebound. The financial world bounced back nicely from a disruptive 2020 that was dominated by fears of the COVID-19 pandemic. All eyes are on central banks ahead of March 2022 as inflation has soared to multi-decade highs. Higher rates may eat into credit growth, but banks will also benefit from improved profit margins in that event.
The bank released its first quarter 2022 earnings on February 24. Net income increased 6% year-over-year to $4.1 billion and diluted earnings per share jumped 7% to $2.84.
Royal Bank’s Personal and Commercial Banking segment delivered net income growth of 10% to $1.97 billion. This was powered by volume growth, itself fueled by strong residential mortgage increases. Meanwhile, net income in its Wealth Management segment climbed 24% year-over-year to $795 million. The bank achieved this growth due to high average fee-based client assets as well as improved net sales.
This bank stock currently possesses a price-to-earnings ratio of 12. That puts Royal Bank in solid value territory at the time of this writing. It offers a quarterly dividend of $1.20 per share. This represents a 3.4% yield.
Related Stories
