Bank Of Montreal (BMO) AI Stock Analysis

• Market Cap: C$127.83B
• Dividend Yield: 3.9%
• Average Volume (3M): 2.09M
• Price to Earnings (P/E): 15.8
• Beta (1Y): 1.24
• Revenue Growth: 1.78%
• EPS Growth: 32.32%
• Country: CA
• Employees: 53,597
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Diversified
• EPS (TTM): 3.23
• Shares Outstanding: 716,360,530
• 10 Day Avg. Volume: 2,150,197
• 30 Day Avg. Volume: 2,091,412
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$171.82
• Price Target Upside: -3.72% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 74 Outperform
• Price Target: C$191.00 ▲(7.03% Upside)

The Bank of Montreal's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. The stock's valuation is attractive, but technical indicators suggest it may be overbought. High leverage and cash flow concerns are notable risks.

Positive Factors

Revenue Growth

Consistent revenue growth indicates robust business expansion and effective market strategies, enhancing long-term financial stability.

Strong Earnings Performance

Record net income and strong earnings per share growth reflect effective operational management and strategic execution, supporting future profitability.

Wealth Management Growth

Record revenue in Wealth Management demonstrates effective client acquisition and service offerings, contributing to diversified income streams.

Negative Factors

High Debt Levels

Significant leverage poses risks in adverse conditions, potentially impacting financial flexibility and increasing vulnerability to economic downturns.

Cash Flow Constraints

Declining free cash flow growth raises concerns about cash generation, which could affect the company's ability to fund operations and investments.

Challenges in Canadian Banking

Declining net income in Canadian banking indicates challenges in the domestic market, potentially affecting overall profitability and growth prospects.

Bank Of Montreal Business Overview & Revenue Model

Company Description

Bank of Montreal provides diversified financial services primarily in North America. The company's personal banking products and services include checking and savings accounts, credit cards, mortgages, and financial and investment advice services; and commercial banking products and services comprise business deposit accounts, commercial credit cards, business loans and commercial mortgages, cash management solutions, foreign exchange, specialized banking programs, treasury and payment solutions, and risk management products for small business and commercial banking customers. It also offers investment and wealth advisory services; digital investing services; financial services and solutions; and investment management, and trust and custody services. In addition, the company provides life insurance, accident and sickness insurance, and annuity products; creditor and travel insurance to bank customers; and reinsurance solutions. Further, it offers client's debt and equity capital-raising services, as well as loan origination and syndication, and treasury management; strategic advice on mergers and acquisitions, restructurings, and recapitalizations, as well as valuation and fairness opinions; and trade finance, risk mitigation, and other operating services. Additionally, the company provides research and access to markets for institutional, corporate, and retail clients; trading solutions that include debt, foreign exchange, interest rate, credit, equity, securitization and commodities; new product development and origination services, as well as risk management advice and services to hedge against fluctuations; and funding and liquidity management services to its clients. It operates through approximately 900 bank branches and 3,300 automated banking machines in Canada and the United States. Bank of Montreal was founded in 1817 and is headquartered in Montreal, Canada.

How the Company Makes Money

BMO generates revenue primarily through interest income from loans and mortgages, fees from various banking services, and investment management fees. The main revenue streams include interest from personal banking, commercial loans, and credit cards, which are supplemented by transaction and service fees from account management and advisory services. Additionally, BMO Capital Markets contributes to revenue through underwriting, trading, and advisory services, while its Wealth Management division earns fees from asset management and financial planning. Strategic partnerships and a strong retail presence enhance customer acquisition and retention, further driving revenue growth.

Bank Of Montreal Financial Statement Overview

Summary

Bank of Montreal shows strong revenue growth and profitability with solid margins. However, high leverage and declining cash flow growth present potential risks. The company needs to focus on improving cash flow management and reducing leverage to enhance financial stability.

Income Statement

The Bank of Montreal shows strong revenue growth with a 17.84% increase in TTM, indicating robust business expansion. Gross profit margin is healthy at 39.15%, and net profit margin has improved to 11.09%, reflecting enhanced profitability. EBIT and EBITDA margins are solid, supporting operational efficiency. However, historical fluctuations in revenue growth and margins suggest potential volatility.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 4.54, indicating significant leverage, which could pose risks in adverse conditions. Return on equity is moderate at 10.13%, showing reasonable profitability from shareholders' equity. The equity ratio is relatively low, suggesting limited equity financing. Overall, the balance sheet is stable but with notable leverage concerns.

Cash Flow

The cash flow statement highlights a significant decline in free cash flow growth by 74.17% in TTM, raising concerns about cash generation. The operating cash flow to net income ratio is low at 0.002, indicating potential cash flow constraints. However, the free cash flow to net income ratio remains positive at 0.24, suggesting some level of cash profitability. Overall, cash flow management needs improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	78.61B	78.56B	29.02B	26.26B	26.91B	22.23B
Gross Profit	30.77B	28.28B	29.64B	25.95B	26.91B	25.02B
EBITDA	13.55B	11.18B	7.71B	19.00B	11.44B	7.61B
Net Income	8.72B	7.32B	4.42B	13.54B	7.75B	5.10B
Balance Sheet
Total Assets	1.43T	1.41T	1.29T	1.14T	988.17B	949.26B
Cash, Cash Equivalents and Short-Term Investments	169.21B	113.53B	114.31B	118.21B	121.97B	95.24B
Total Debt	394.00B	262.44B	248.74B	222.64B	189.81B	187.01B
Total Liabilities	1.34T	1.33T	1.22T	1.07T	930.65B	892.67B
Stockholders Equity	86.72B	84.25B	77.01B	71.04B	57.52B	56.59B
Cash Flow
Free Cash Flow	518.00M	27.47B	19.59B	3.51B	43.07B	49.80B
Operating Cash Flow	2.18B	29.03B	21.27B	4.96B	44.05B	50.84B
Investing Cash Flow	-5.94B	-24.53B	-21.16B	-29.47B	-299.00M	-31.97B
Financing Cash Flow	-12.02B	-17.41B	268.00M	15.98B	47.12B	-10.30B

Bank Of Montreal Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 178.45
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:BMO, the sentiment is Positive. The current price of 178.45 is above the 20-day moving average (MA) of 174.33, above the 50-day MA of 163.14, and above the 200-day MA of 144.79, indicating a bullish trend. The MACD of 5.13 indicates Positive momentum. The RSI at 72.63 is Negative, neither overbought nor oversold. The STOCH value of 74.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:BMO.

Bank Of Montreal Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CM	78 Outperform	104.26B	13.60	12.99%	3.40%	-0.39%	20.28%
NA	78 Outperform	59.80B	14.73	―	2.99%	9.25%	0.34%
RY	75 Outperform	287.70B	15.47	14.13%	2.89%	3.48%	17.81%
BMO	74 Outperform	C$127.83B	15.81	10.20%	3.90%	1.78%	32.32%
TD	74 Outperform	185.39B	9.32	16.66%	3.84%	7.92%	175.59%
BNS	71 Outperform	110.69B	16.60	―	6.12%	-2.54%	-6.66%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Bank Of Montreal Corporate Events

BMO to Redeem $200 Million in Preferred Shares

Bank of Montreal announced its plan to redeem all 8,000,000 outstanding Non-Cumulative 5-Year Rate Reset Class B Preferred Shares, Series 33, for a total of $200 million on August 25, 2025. This move, approved by the Office of the Superintendent of Financial Institutions, reflects BMO’s strategic financial management and may impact shareholder returns with the final quarterly dividend to be paid separately.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$150.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

BMO to Acquire Burgundy Asset Management, Enhancing Wealth Management Services

BMO has announced its acquisition of Burgundy Asset Management, a leading independent wealth manager with $27 billion in assets under management. This strategic move is expected to enhance BMO’s wealth management capabilities, particularly in the Canadian Investment Counsel space, and strengthen its position as a top provider for high-net-worth clients. The transaction, valued at approximately $625 million, is anticipated to close by the end of 2025, subject to regulatory approvals.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$150.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

BMO Financial Group Strengthens Leadership with Key Executive Appointments

BMO Financial Group has announced several executive appointments aimed at enhancing client service and supporting growth ambitions in Canada and the U.S. These changes are designed to streamline decision-making, improve profitability, and foster innovation through leadership in AI, data, and cloud computing. The appointments reflect BMO’s commitment to talent development and strategic integration of its U.S. operations, with a focus on ethical performance and strong governance.

The most recent analyst rating on (TSE:BMO) stock is a Hold with a C$141.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

BMO Financial Group Boosts Quarterly Dividend by 3%

BMO Financial Group announced an increase in its quarterly dividend for common shares by 4 cents to $1.63 per share, marking a 3% rise from the previous quarter and a 5% increase from the prior year. This decision reflects BMO’s commitment to delivering value to its shareholders and may enhance its attractiveness to investors. The dividends for both common and preferred shares are scheduled for payment in August 2025, with the option for common shareholders to reinvest dividends through the bank’s Shareholder Dividend Reinvestment and Share Purchase Plan.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$150.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

BMO Financial Group Reports Strong Q2 2025 Results with Increased Dividends

BMO Financial Group reported its second quarter 2025 financial results, showing an increase in both reported and adjusted net income compared to the previous year. The company achieved strong revenue and pre-tax earnings growth across its operating groups, despite a rise in provisions for credit losses. BMO’s robust capital position allowed it to increase its dividend and execute share buybacks, demonstrating resilience and commitment to shareholder returns.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$150.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.