Canadian banks keep getting called unstoppable. Bank stocks have a rare mix of scale, pricing power, and habit. Most Canadians pay a bank before it pays them, whether through mortgages, credit cards, investing fees, or business banking. In 2025, that dependable machine also got a boost from stronger capital markets and wealth activity, and the group’s shares rose sharply. This made the momentum feel almost self-fulfilling. The catch is that “unstoppable” usually shows up right when valuations stop looking cheap, so it pays to separate the strong business from the hype.
Consider RY
Royal Bank of Canada (TSX:RY) is the biggest name in the group, and it earns that title the boring way: it does almost everything. It runs personal and commercial banking, wealth management, insurance, and a large capital markets arm, so it does not rely on one single profit engine. It also expanded further at home through its HSBC Canada acquisition, which added more customers and more deposits to the core franchise.
The bank stock performance explains why people feel so confident right now. Shares of the bank stock are up 34% in the last year alone as well. That is a big move for a bank, and it tells you the market has already started to price in a friendlier earnings backdrop and steadier credit conditions.
That kind of run can make investors nervous, but it also reflects what RBC has done well. It has leaned into fee-heavy businesses like wealth and capital markets when markets get busy, while still collecting steady banking income underneath it all. There has been strength in capital markets and wealth management as a key reason RBC beat profit estimates in its most recent quarter, which matters as it suggests the bank can grow even when traditional lending feels less exciting.
Into earnings
RBC’s latest results gave the market plenty to like. In the fourth quarter of fiscal 2025, it reported net income of $5.4 billion and diluted earnings per share (EPS) of $3.76, both up 29% from a year earlier, and reported adjusted net income of $5.6 billion with adjusted diluted EPS of $3.85. It also finished the quarter with a CET1 capital ratio of 13.5%, which gives it a comfortable cushion for growth and uncertainty.
The bank did not just grow earnings. It also paid shareholders more. In that same release, RBC declared a quarterly dividend of $1.64 per share, an increase of $0.10, or 6%. Zooming out, the full-year numbers help explain the confidence. For fiscal 2025, RBC reported net income of $20.4 billion and diluted EPS of $14.07, both up 25% year over year, alongside a full-year ROE of 16.3%. All while shares trade at about 16.6 times earnings at writing with a 6.6% dividend yield. That may not be a “high-yield” pitch. It’s a “reliable grower” pitch.
The outlook into 2026 looks solid, but it’s not risk-free, and that matters if you are buying after a big run. RBC revised its fiscal 2026 ROE objective to 17% or higher, which signals confidence in revenue productivity and cost efficiencies. At the same time, provisions for credit losses came in around $1 billion in the quarter, and it noted that unemployment and housing softness remain watch items. Banks can look unstoppable right up until credit turns, so you want to keep one eye on that.
Bottom line
RY still looks like the one to buy right here as it combines momentum with quality, and it just proved it can grow across multiple engines at once. It raised the dividend, held a strong capital ratio, and delivered record-level quarterly profit while credit costs stayed manageable. Meanwhile, here’s what $7,000 could bring in at writing.
The honest counterpoint is price. Canadian bank stocks have traded at a premium to their longer-term averages after the rally, so you should expect some pullbacks along the way. If you can handle that and you want the most all-weather bank in Canada, RY still earns the “unstoppable” label for the right reasons.
