Episode Details

Royal Bank of Canada (RY, NYSE) Q2 FY2026 earnings breakdown - conversational walkthrough with a price-aware verdict and Wall Street consensus comparison. Financials reported in Canadian dollars (CAD); share price and price targets in USD (NYSE), FX about 1.37 CAD per USD. THE CALL: HOLD (3/5 conviction, MODERATE) - CURRENT @ $187.97 (USD) -> HOLD - BUY below $165.00 with $148.00 stop - AVOID above $210.00 TRIGGER: Add aggressively if PCL stays below 35 bps for two quarters AND the stock retests $165 WINDOW: 12-18 months - best-in-class earnings power and capital return versus a premium entry WALL STREET CONSENSUS - Ratings: 0 Strong Buy / 12 Buy / 16 Hold / 1 Sell / 0 Strong Sell -> HOLD - Median 12-month price target: $195.00 USD (range $158 - $215) THESIS RBC is Canada's largest bank, earning a high-teens return on equity with a strong 13.5% CET1 capital ratio, diversified business lines spanning Canadian banking, wealth, capital markets and U.S. City National, and a credit book whose provisions are improving rather than deteriorating. Bull lever: Diluted EPS grew 27% year over year as provisions fell 36% and wealth, commercial and capital markets all posted double-digit gains; capital strength funded a 14% dividend increase and a new buyback of up to 45 million shares. Key risk: The stock has already run roughly 46% in a year to near its 52-week high and trades at the top of the big-bank range, leaving a thin margin of safety if the credit cycle turns. QUALITY CHECK - Management quality grade: A - Earnings quality grade: A KEY METRICS - Q2 FY2026 (CAD unless noted) - Diluted EPS: C$3.86 (+27.0% YoY; a clean beat) - Net income: C$5.51B (+25% YoY) - Total revenue: C$33.93B (+4.2% YoY) - Return on equity: 17.2% (up from 14.2% a year ago) - CET1 capital ratio: 13.5% (well above the 11.5% regulatory floor) - Provisions for credit losses (PCL): C$912M (down 36% YoY) - Efficiency ratio: ~52% - Dividend raised 14% YoY plus a new buyback of up to 45 million shares - Dividend yield: ~2.5% (USD); stock up ~46% over the trailing year DISCLAIMER This is for informational and educational purposes only. Not financial advice. Charged Alpha does not have a position in RY. #RY #RBC #RoyalBankofCanada #earnings #investing #stocks #ChargedAlpha #Banks #Dividend