Royal Bank of Canada (RY) Stock: Record 2025 Earnings, Dividend Hike and 2026 Outlook

Royal Bank of Canada stock (TSX: RY, NYSE: RY) is back in the spotlight after delivering record 2025 earnings, hiking its dividend and drawing a wave of fresh analyst upgrades on December 3, 2025. New guidance, an auditor’s confirmation of financial health and ongoing integration of HSBC Canada are all reshaping the investment narrative around Canada’s largest bank. ^[1]

Below is a detailed look at today’s news, the latest forecasts, and how analysts now view Royal Bank of Canada stock.

RBC stock today: price, valuation and performance

On the NYSE, Royal Bank of Canada shares trade around US$154 as of December 3, 2025, roughly flat to the latest 12‑month median Wall Street price target of US$154.63 compiled by Ticker Nerd. ^[2]

On the Toronto Stock Exchange, recent data from MarketBeat show RY changing hands in the C$214–C$216 range, close to its 12‑month high of C$216.23, with a trailing price‑to‑earnings ratio of about 16.2 and a market capitalization just over C$300 billion. ^[3]

RBC has also been a major contributor to the TSX’s strong 2025 run. Zacks data (via Nasdaq) estimates Royal Bank shares are up about 28% year‑to‑date, ahead of the S&P 500’s roughly 16% gain, while Reuters notes that Canada’s “Big Six” banks as a group have returned around 32% this year, outpacing the broader TSX. ^[4]

Put simply: the stock is already priced for strength, not distress.

Fourth‑quarter and full‑year 2025 results: record year, big beat

RBC’s December 3 earnings release and accompanying coverage confirm that 2025 was a record year for the bank.

According to the official results, for the fiscal year ended October 31, 2025 Royal Bank of Canada reported: ^[5]

Net income of C$20.4 billion, up 25% year‑on‑year
Diluted EPS of C$14.07, also up 25%
Adjusted net income of C$20.9 billion and adjusted EPS of C$14.43, up 20% and 19%, respectively
Return on equity (ROE) of 16.3%, with adjusted ROE of 16.7%
A CET1 capital ratio of 13.5%, comfortably above regulatory minimums

Pre‑provision, pre‑tax earnings climbed 30% versus last year, helped by higher net interest income in personal and commercial banking, strong capital markets revenue and increased fee‑based revenue in wealth management. The results also reflect five additional months of contribution from the acquired HSBC Bank Canada franchise. ^[6]

For the fourth quarter alone, Reuters and Zacks highlight that: ^[7]

Adjusted net income rose 25% to C$5.55 billion
Adjusted EPS came in at C$3.85, beating analyst expectations of C$3.53
Capital markets net income jumped 45.3%, driven by stronger trading revenue, higher lending and robust M&A activity
Wealth management earnings increased 32.5%, helped by market appreciation and net asset inflows
Provisions for credit losses (PCL) in the quarter were C$1.0 billion, just above the C$973.8 million consensus but still described as “manageable” by at least one analyst

Management’s commentary framed 2025 as a year where the bank’s diversification and scale – across Canadian banking, capital markets, wealth, insurance and U.S. operations – allowed it to absorb higher credit costs while still expanding earnings and returns. ^[8]

Dividend hike and capital strength

Alongside the earnings report, RBC’s board announced another dividend increase. A separate December 3 press release confirmed: ^[9]

The quarterly common share dividend will rise by C$0.10 (about 6%) to C$1.64 per share
The higher dividend is payable on or after February 24, 2026 to shareholders of record as of January 26, 2026
Several series of non‑cumulative preferred shares also received declared dividends

Using the new C$1.64 quarterly dividend (C$6.56 annualized) and a share price around the mid‑C$210s, the forward dividend yield is roughly 3%, in line with RBC’s reputation as a reliable income stock but lower than some Canadian peers with higher payout ratios. ^[10]

Crucially, the dividend hike comes on top of a still‑strong capitalization profile: the fiscal 2025 CET1 ratio of 13.5% and a liquidity coverage ratio of 127% (down slightly from 129% last quarter) leave the bank with ample capacity to fund growth, continue buybacks and absorb potential credit stresses. ^[11]

2025 annual report and auditor’s opinion: “Client Focused, Future Ready”

Beyond the headline numbers, two governance‑related updates landed today:

2025 Annual Report: RBC formally released its 2025 annual report on December 3, framed around the strategic theme “Client Focused, Future Ready.” The report emphasizes the bank’s efforts to adapt to shifting client needs and future market demands, positioning its digital, data and advisory capabilities as core competitive advantages. ^[12]
Independent auditor’s report: An auditor’s report, also released December 3, confirmed that RBC’s consolidated financial statements for 2024 and 2025 present fairly, in accordance with IFRS. Key audit matters included the allowance for credit losses on loans and uncertain tax positions, both areas requiring significant judgment and modelling. ^[13]

For investors, the combination of record earnings, a clean audit opinion and a strategy‑heavy annual report is designed to reinforce confidence in both the current financial strength and long‑term roadmap of the bank.

Strategy watch: HSBC Canada integration and the new wave of callable debt

Royal Bank of Canada is still digesting its HSBC Bank Canada acquisition, completed in March 2024. The 2025 results include five extra months of HSBC Canada’s contribution, and management continues to frame the deal as a way to deepen its premium retail and commercial franchise at home while unlocking cost and revenue synergies over the next several years. ^[14]

At the same time, investors have been watching a recent wave of callable debt issuance:

In recent weeks, RBC has issued several fixed‑rate callable senior and junior senior unsecured notes with maturities stretching from 2028 to 2055.
A Simply Wall St analysis notes that one key tranche is a 4.05% senior unsecured note due December 18, 2028, which sits in the window when HSBC Canada synergies and credit cycle outcomes will be tested. ^[15]

That analysis argues the new callable funding modestly refreshes RBC’s liability structure but doesn’t fundamentally change the narrative: investors still need to believe that scale, diversified earnings and a long dividend record will offset any drag from higher funding costs and potential credit losses as the cycle matures. ^[16]

The same piece projects RBC could generate C$68.6 billion of revenue and C$20.5 billion of earnings by 2028, implying roughly 4.4% annual revenue growth and further expansion from today’s earnings base. Community fair‑value estimates cluster around C$219 per share, close to the current price, though individual views range widely. ^[17]

What are analysts saying about Royal Bank of Canada stock now?

Canadian‑dollar targets (TSX: RY)

On the Toronto‑listed shares, data from MarketBeat and a fresh upgrade from National Bank paint a picture of broadly positive but valuation‑sensitive sentiment:

Consensus rating: “Moderate Buy” based on 14 analysts, with 5 Hold, 7 Buy and 2 Strong Buy ratings. ^[18]
Average 12‑month price target:C$216.43, implying only about 0.1% upside from a recent price near C$216.21. High and low estimates span C$238 to C$189. ^[19]
National Bank of Canada upgrade: On December 3, National Bank upgraded RBC from “Hold” to “Strong Buy”, citing increased confidence after the recent run of results. The same article highlights that UBS, Raymond James, Barclays and TD Securities all raised their TSX price targets in recent weeks, with top‑end targets around C$238. ^[20]

In short, Canadian‑dollar targets suggest RBC is near “fair value”, with most of the upside now embedded unless earnings surprise higher again.

U.S.‑dollar targets (NYSE: RY)

For the NYSE‑listed RY shares, forecasts cluster even more tightly around the current price:

Ticker Nerd reports 6 Wall Street analysts with a median 12‑month target of US$154.63, ranging from US$120.87 to US$163.58, and calls the overall analyst stance bullish / Strong Buy, with 12 Buy, 3 Hold and 1 Sell ratings aggregated from various sources. ^[21]
Public.com’s forecast page, which tracks a smaller analyst sample, shows a Buy consensus and notes a longer‑term target around US$186 based on an unchanged 12.8× 2026 P/E multiple, while quoting a nearer‑term price target of US$177.50 that implies little upside from current levels. ^[22]

TradingView’s forecast page for TSX:RY similarly shows a C$222.86 consensus price target, with a C$206–C$238 range and an overall analyst rating of “Buy” based on 16 recent opinions. ^[23]

Taken together, the message from the sell‑side is:

RBC is high quality and still widely liked
Expected upside over 12 months is modest, barring stronger‑than‑modeled growth or a further re‑rating

Macro backdrop: how 2026 could shape RBC’s next leg

RBC’s fate is intertwined with the Canadian and U.S. economies, and the bank’s own wealth‑management arm has just released its “Global Insight 2026” outlooks:

In the Canada outlook, RBC Wealth Management highlights that the S&P/TSX Composite is on track for one of the best returns among developed markets in 2025, helped by all‑time‑high gold prices and improving sentiment around domestic lenders. The authors note that the recent federal budget could provide an additional tailwind and argue for a focus on “quality” stocks – a category that typically includes big banks such as RBC. ^[24]
In the U.S. outlook, RBC’s economists project U.S. GDP growth of about 2.2% in 2026, above consensus expectations and in line with the long‑run average. The team begins 2026 with a “Market Weight” stance on U.S. equities and a preference for dividend‑growth stocks – again, a backdrop that fits large, profitable banks reasonably well. ^[25]

Meanwhile, Reuters’ pre‑earnings survey of Canada’s major banks stressed that valuations across the Big Six are already “high”, with the group trading at roughly 12.9× forward earnings, a 23% premium to the 10‑year average. That leaves less room for error if credit costs or growth disappoint in 2026. ^[26]

Key risks: credit cycle, housing and rich valuations

Despite today’s upbeat headlines, several risks keep analysts cautious about piling in at current levels:

Credit quality and housing: RBC’s provisions for credit losses rose to C$4.4 billion for 2025, with a PCL‑on‑loans ratio that has ticked higher year‑on‑year. ^[27] Reuters points to rising unemployment and a still‑weak housing market as ongoing pressure points for Canadian lenders, especially as borrowers roll into higher mortgage rates. ^[28]
Earnings estimate drift: Public.com’s summary notes that core cash EPS estimates for fiscal 2025 and 2026 have been trimmed by about 1% in earlier periods due to expectations of higher credit losses and slight net‑interest‑margin compression, particularly in commercial banking. ^[29]
Valuation sensitivity: MarketBeat flags a beta of 1.28 and a relatively elevated P/E multiple (around 16×), which can magnify the impact of macro shocks on the share price. ^[30] Reuters similarly warns that Big Six banks’ premium valuations could reset if earnings disappoint. ^[31]
Model‑based long‑term forecasts: Independent platforms like Meyka and Simply Wall St model RBC’s fair value and long‑term price paths (with some scenarios reaching C$237–C$280 by 2027), but they stress that these projections depend on steady mid‑single‑digit growth and manageable credit costs – assumptions that could be challenged in a prolonged downturn. ^[32]

None of these risks are unique to RBC, but given how well the stock has already performed, they matter more for entry price than for franchise quality.

Bottom line: where Royal Bank of Canada stock stands after December 3, 2025

As of December 3, 2025, the Royal Bank of Canada story looks like this:

Fundamentals: Record 2025 earnings, a strong capital position, a growing wealth and capital‑markets franchise and continued benefits from the HSBC Canada acquisition. ^[33]
Shareholder returns: A fresh 6% dividend increase takes the yield to around 3% on TSX prices, backed by robust profitability and capital ratios. ^[34]
Sentiment: Most analyst and platform‑aggregated ratings cluster around Buy / Moderate Buy, but 12‑month price targets are now very close to current levels in both Canada and the U.S., suggesting the easy money has been made. ^[35]
Risk‑reward: The main debate is less about whether RBC is a solid bank – the new auditor’s report and capital metrics strongly support that – and more about whether investors are being paid enough to take on credit‑cycle and macro risk at today’s valuations. ^[36]

For existing shareholders, today’s news flow – record results, a higher dividend, a clean audit and supportive macro commentary – is broadly reassuring. For potential new investors, the data suggest Royal Bank of Canada stock is high quality but not obviously cheap, with future returns likely to depend on how 2026’s credit trends, rate environment and global growth actually play out.