A Reversal for Bank of Nova Scotia Is Not Near. The Stock Gaps Down

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The stock of Bank of Nova Scotia (BNS) gapped down by $0.12 today and has $30.65 target or 32.00% below today’s $45.08 share price. The 9 months technical chart setup indicates high risk for the $54.23 billion company. The gap down was reported on Nov, 12 by Barchart.com. If the $30.65 price target is reached, the company will be worth $17.35 billion less.
Gaps down are helpful for identifying a resistance level and to could also be used as a tradeable event. If traders are short the stock and it experiece gap down, then its usually advisable to hold the short for a bigger down move. Back-tests of such patterns show that two-thirds of the these patterns the stock performance worsens after the gap. The area gaps close 91% of the time, the breakaway gaps 1%, the continuation gaps 9% and the exhaustion gaps 64%. The stock is down 1.77% or $0.81 after the news, hitting $45.08 per share. About 232,274 shares traded hands. Bank of Nova Scotia (NYSE:BNS) has declined 10.41% since April 10, 2015 and is downtrending. It has underperformed by 9.12% the S&P500.

Analysts await Bank of Nova Scotia (NYSE:BNS) to reports earnings on December, 4. They expect $1.10 earnings per share, down 5.17% or $0.06 from last year’s $1.16 per share. BNS’s profit will be $1.32B for 10.25 P/E if the $1.10 EPS becomes reality. After $1.18 actual earnings per share reported by Bank of Nova Scotia for the previous quarter, Wall Street now forecasts -6.78% negative EPS growth.

Out of 5 analysts covering The Bank Of Nova Scotia (NYSE:BNS), 2 rate it “Buy”, 0 “Sell”, while 3 “Hold”. This means 40% are positive. The Bank Of Nova Scotia was the topic in 9 analyst reports since August 4, 2015 according to StockzIntelligence Inc.

According to Zacks, “Bank of Nova Scotia is one of North America’s premier financial institutions and Canada’s most international bank. They offer a diverse range of products and services including personal, commercial, corporate and investment banking. Scotiabank has built long-term value and recorded consistent earnings growth by building on its core strengths and by executing exceptionally well in its core businesses. These include Domestic Banking, Wealth Management, International Banking and Scotia Capital.”

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