TD Bank raised to 'outperform' by BMO, says stock trading at steep discount
** BMO Capital Markets upgrades Canada's Toronto-Dominion Bank TD.TO to "outperform" from "market perform," citing favorable risk-reward and the stock trading at a steep discount to peers
** Brokerage says that at its target price of C$90 it sees 25% upside to the stock's current trading price over the next year
** Earlier this month, TD warned of a challenging 2025 and suspended its medium-term earnings forecast as the lender works through its anti-money laundering remediation program following a U.S. regulatory probe
** BMO adds that it expects TD's business segments outside of U.S. retail banking to deliver peer-like performance
** "The current valuation of the stock reflects the added uncertainties associated with the bank's decision to suspend medium-term financial targets and embark on a strategic review of its businesses" — BMO
** In October, TD became the largest bank in U.S. history to plead guilty to violating a federal law aimed at preventing money laundering, and agreed to pay over $3 bln in penalties
** TD CEO Bharat Masrani is also set to step down in April and will be replaced by TD's Canadian banking unit head Ray Chun
** TD is down ~13% YTD; Rivals Royal Bank of Canada RY.TO and Bank of Nova Scotia BNS.TO have gained ~29% and ~20% over the same period, respectively
Reporting by Manya Saini in Bengaluru
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