RBC Sees Record Institutional Demand Amid Valuation Concerns
The Royal Bank of Canada (RBC) has seen significant institutional interest in its shares over the past year, with more buyers than sellers and a net inflow of $16.89 billion.
According to data from MarketBeat, 566 institutional buyers have purchased RBC shares compared to 298 sellers in the last 12 months. The total inflows amount to $24.17 billion, while outflows stand at $7.28 billion, resulting in a net inflow of $16.89 billion.
Despite this demand, analysts maintain an optimistic view on RBC's direction but their targets fall short of the latest Toronto price. The TSX consensus stands at Moderate Buy with eight buys, one strong buy and three holds, featuring an average target of C$262.96, which is 10.4% under the quoted market price of C$293.47.
RBC's valuation remains a concern as shares are trading at close to record levels, with the sector holding a forward price-to-earnings ratio of about 15, compared to similar U.S. banks that trade at around 12 times forward earnings.