Bank of Nova Scotia stock price
BNS is trading above $101 per share at the time of writing. The stock price is up more than 30% so far in 2025 and is on a steady upward trend after the April rate change, which saw shares fall below $64.
The broader banking sector has delivered strong returns over the past nine months as economies in both Canada and the United States remained resilient despite turbulence caused by U.S. tariffs and uncertainty over trade negotiations. Falling interest rates have also helped ease pressure on over-indebted households and businesses. This should help banks reduce loan loss provisions. At the same time, interest rates still remain high enough for banks to generate decent net interest margins.
Bank of Nova Scotia’s stock price actually started the year on a negative trend. The stock faced headwinds in the first few months of 2025 after the company announced it would take a big charge on its planned asset sales in Colombia, Costa Rica and Panama. The sale of these businesses is part of the Bank of Nova Scotia’s strategy, which will see the bank allocate growth capital to the United States and Canada, rather than Latin America, where the Bank of Nova Scotia has spent billions of dollars on acquisitions over the past thirty years to build a large presence in the region. The bank still has significant operations in Mexico, Peru and Chile.
There may be more income coming in. Investors will want to see whether the hit to asset sales this year is a one-off issue or if it is the first phase of a painful trend as the bank progresses in its strategy transition.
Income
Solid business performance in the broader sector has helped investors forget about the costs of asset sales. Bank of Nova Scotia reported adjusted net income of $2.56 billion for the fourth quarter of 2025, compared to $2.12 billion in the same period last year. Return on equity (ROE) rose to 12.5%, up from 10.6%. For the full fiscal year, Bank of Nova Scotia generated adjusted net income of $9.51 billion, compared to $8.63 billion in 2024. Return on equity increased from 11.3% to 11.8%.
Outlook
Rising copper and gold prices bode well for Mexico, Peru and Chile. This should be positive for Bank of Nova Scotia’s remaining operations in Latin America. Chile’s new president is expected to introduce policies to boost the mining sector. Peru will hold presidential elections in 2026. Political volatility has been a problem in the region for some time. A period of stability would help attract investment.
In the United States, the Bank of Nova Scotia spent $2.8 billion in 2024 to purchase a 14.9% stake in KeyCorp, a US regional bank. The deal gives Bank of Nova Scotia a platform to expand its presence in the U.S. market.
At home, Bank of Nova Scotia is streamlining operations to make the company more efficient.
Risks
Companies could face bigger headwinds if trade talks with the United States stall or result in painful compromises for key industries. A new rise in unemployment in Canada would put pressure on households still struggling with too much debt. Investors should also be prepared for a possible market correction.
Should You Buy BNS Stock Now?
Short-term turbulence in the broader stock market is to be expected. That said, despite the big rally, BNS still offers a dividend yield of 4.3% at the current share price, so you’re being paid well to weather some volatility. Existing owners of the shares should probably continue to hold the shares. New buyers focused on dividends might consider taking a small position and considering a decline.
Over the long term, BNS should rise if management continues to deliver ROE improvements.
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