Honestly, if you’ve been watching the TD stock price TSX over the last couple of years, it’s felt a bit like a soap opera. You had the money laundering scandal in the States, the massive $3.1 billion penalty, and an asset cap that basically told TD they weren’t allowed to grow south of the border for a while. It was messy. But as we settle into January 2026, the vibe around Toronto-Dominion Bank (TSX: TD) is starting to feel... different.
The stock is currently trading around the $131.00 range on the Toronto Stock Exchange. It’s a far cry from the panic levels we saw back in 2024. People are finally looking past the fines and focusing on the fact that, at its core, this is still a massive cash-flow machine.
The Reality of the TD Stock Price TSX Today
Let's cut to the chase. The "big scary thing" was the U.S. Department of Justice settlement. That’s done. TD paid the piper. Now, the market is pricing in the recovery.
While the stock has shown some volatility lately—dipping slightly to around $130.16 last week before climbing back up—the long-term trajectory looks surprisingly resilient. Why? Because the Canadian side of the business is a powerhouse. In the last quarter of 2025, their Canadian Personal and Commercial Banking net income hit $1.87 billion. That’s a lot of mortgages and credit card swipes.
Investors are currently staring at a P/E ratio of about 15.66. Compare that to BMO or Scotiabank, and TD isn't exactly the "cheap" play, but it’s the "quality" play that’s been on sale.
Why the Dividend is Still the Star of the Show
You don't buy TD for explosive, Nvidia-style growth. You buy it because they pay you to sit there.
On January 8, 2026, the stock went ex-dividend with a payout of $1.08 per share. If you’re keeping track, that’s an annualized dividend of $4.32. With the current TD stock price TSX hovering where it is, you’re looking at a yield of roughly 3.3%.
It’s not the highest in the banking sector—CIBC usually wins that contest—but TD’s payout ratio is a healthy 36% to 48% depending on how you calculate the one-time legal hits. That’s safe. Like, "sleep well at night" safe.
What Most People Get Wrong About the Asset Cap
There’s this common idea that because the U.S. regulators put a $434 billion asset cap on TD's American operations, the bank is "stuck."
Kinda, but not really.
The cap limits the size of the balance sheet, but it doesn't stop them from becoming more efficient. New CEO Raymond Chun has been pretty vocal about "running a simpler and faster bank." They are leaning hard into AI—investing millions into use cases that cut operational costs. If you can't grow the top line by getting bigger, you grow the bottom line by getting smarter.
- The Bull Case: Canadian retail is surging, and the bank is sitting on a mountain of excess capital.
- The Bear Case: The U.S. remediation is a multi-year slog. It’s going to cost billions in "governance and control" investments before the regulators let them off the leash.
A Nuanced Look at the 2026 Outlook
Analysts are currently split, but the consensus leans toward a "Buy." Out of about 11 major analysts tracking the stock, over 50% have a Buy rating. They’re forecasting an EPS (Earnings Per Share) of around $8.86 for fiscal 2026.
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If they hit that, the current TD stock price TSX looks like a bargain.
But you have to be realistic. We’re in a weird economic cycle. The Bank of Canada is likely at the end of its easing cycle, and while inflation is cooling toward that 2% sweet spot, the "higher for longer" interest rate environment has a double-edged sword effect. It helps TD's net interest margins (NIM), but it also puts pressure on Canadian households who are staring down mortgage renewals at much higher rates than 2021.
What to Watch in the Coming Months
- PCLs (Provisions for Credit Losses): Watch this number in the next earnings report. If it stays in the 40-50 basis point range, TD is in the clear. If it spikes, it means Canadians are struggling to pay those loans.
- The Buyback Program: TD announced a massive $6-7 billion share buyback. When a bank buys back its own stock, it’s basically saying, "We think our shares are undervalued."
- U.S. Remediation Progress: Any news about the "five-year probationary term" being shortened or the asset cap being adjusted would send the stock flying.
Actionable Insights for Investors
If you're looking at the TD stock price TSX and wondering if you should pull the trigger, here’s how to approach it:
- Don't chase the daily swings. TD is a "buy and hold" staple. If you're trying to day-trade a Big Five bank, you're going to have a bad time.
- Check your exposure. Many Canadian portfolios are already 20% or 30% weighted in financials. Make sure you aren't doubling down too hard just because the yield looks juicy.
- Focus on the DRIP. If you hold TD in a TFSA or RRSP, set up a Dividend Reinvestment Plan. Buying more shares at $131 with "house money" is how you actually build wealth over a decade.
The drama of 2024 is in the rearview mirror. Now, it’s about execution. TD is basically a bored giant trying to get back into shape. It might take a minute, but the dividends will keep rolling in while you wait.
Next Step for You: Check your brokerage account for the next "Item of Note" in TD's quarterly filing, specifically looking for any updates on "non-interest expenses" related to U.S. compliance. This will tell you exactly how much the remediation is still biting into the profits.