Abstract

Bank of Nova Scotia will release fiscal third-quarter results on August 25, 2026 Pre-MKt. This preview consolidates the company’s latest guidance and market forecasts to outline consensus expectations for revenue, margins, earnings, and segment performance, alongside key debates shaping the stock into the print.

Market Forecast

Consensus points to fiscal Q3 revenue of 9.96 billion US dollars, with EBIT estimated at 4.51 billion US dollars and adjusted EPS at 2.08; year-over-year forecast growth rates are 6.91% for revenue, 5.76% for EBIT, and 20.45% for EPS. Margin discussions center on continued stabilization: the company-guided net profit margin is expected to hold solidly, and efficiency initiatives could support an incremental improvement in profitability on a year-over-year basis. Main business momentum is expected to be balanced across Canadian Banking, International Banking, Global Wealth Management, and Global Banking and Markets, with resilient loan growth and stable credit costs highlighted by management as near-term supports. The most promising area is Canadian Banking with estimated revenue of 3.48 billion US dollars and continued mid-single-digit year-over-year expansion given deposit repricing and fee income resilience.

Last Quarter Review

The previous quarter delivered revenue of 9.84 billion US dollars, GAAP net profit attributable to the parent company of 2.60 billion US dollars, a net profit margin of 30.10%, and adjusted EPS of 2.02; year-over-year growth rates were 8.34% for revenue, 15.95% for EBIT, and 32.90% for EPS. Operating execution was ahead of market estimates as EBIT and EPS exceeded prior forecasts, reflecting disciplined expense management and steady credit performance. By segment, Canadian Banking generated 3.48 billion US dollars, International Banking 2.86 billion US dollars, Global Wealth Management 1.76 billion US dollars, and Global Banking and Markets 1.59 billion US dollars, while Other contributed 0.14 billion US dollars; the revenue mix remained diversified, and management emphasized stable client activity and fee income.

Current Quarter Outlook

Main banking franchise

Across the core Canadian Banking and International Banking operations, the quarter’s setup hinges on loan growth, deposit mix, and funding costs. The bank’s guidance and market expectations imply modest volume expansion with careful balance-sheet optimization, supporting a gradual lift in net interest income. Fee-based lines should add ballast amid a normalizing rate environment, while underwriting and advisory in Global Banking and Markets are anticipated to be steady. Credit costs remain a key variable; however, provisioning trends appear consistent with recent quarters, which underpins the expectation for a stable net profit margin. Operating leverage is likely to be modestly positive as efficiency programs continue, sustaining the year-over-year improvement embedded in the EPS forecast.

Most promising segment

Canadian Banking stands out as the likely incremental driver this quarter, benefiting from customer acquisition, product penetration, and disciplined pricing. Deposit repricing is expected to converge with asset yields at a slower pace than in earlier quarters, tempering net interest margin pressure. Wealth cross-sell into the mass affluent channel and small-business banking engagement should contribute to noninterest revenue, supporting the segment’s mid-single-digit trajectory. With a 3.48 billion US dollars revenue base last quarter, even modest net interest margin stabilization and fee growth can translate into a meaningful uplift in segment earnings.

Key stock-price sensitivities

Investors will focus on net interest income resilience, provision for credit losses, and cost execution. A better-than-expected net interest income print—via stronger volumes or improved deposit mix—would likely be received well. Conversely, a surprise uptick in credit losses, particularly in unsecured retail or select international portfolios, could pressure the stock. Expense discipline after several quarters of investment remains in the spotlight; evidence of durable operating leverage would be a positive signal for sustaining double-digit EPS growth year over year.

Analyst Opinions

Most recent commentary skews neutral-to-positive, with a majority of analysts expecting the bank to meet or slightly beat consensus on EPS while keeping a cautious stance on credit normalization. Well-followed brokerage desks flag the combination of stable net interest income and continued expense control as sufficient to deliver the forecast 20.45% year-over-year EPS increase. The prevailing view emphasizes that execution on cost savings and steady credit will be the swing factors for this quarter, with upside anchored in better operating leverage and downside risks tied to any unexpected deterioration in provisions.