Bank Of Montreal (TSE:BMO)
NYSE:BMO
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Bank Of Montreal
(NYSE:BMO)
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Rating:73Outperform
Price Target:
C$259.00
â–²(24.43% Upside)
Action:Reiterated
Date:06/12/26
The score is driven primarily by improving financial performance and a positive earnings-call outlook (strong earnings/return metrics and solid capital actions). Technicals are supportive with a clear uptrend, though momentum is approaching overbought levels. Valuation is reasonable but not a standout, keeping the overall score in the low-70s.
Positive Factors
Diversified fee growth and segment momentum
BMO's diversified franchise—strong Wealth management inflows, leading Canadian ECM and Capital Markets performance, and improving U.S. banking—reduces dependence on any single revenue source. Durable fee-based growth (AUM and advisory) supports recurring, less rate-sensitive earnings over the next several quarters.
Negative Factors
Elevated financial leverage
Higher leverage compresses balance-sheet flexibility and raises sensitivity to funding stress or rising credit costs. For a large diversified bank, persistent elevated debt-to-equity constrains capital actions and amplifies downside in economic slumps, limiting durable resilience over the medium term.
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Positive Factors
Negative Factors
Diversified fee growth and segment momentum
BMO's diversified franchise—strong Wealth management inflows, leading Canadian ECM and Capital Markets performance, and improving U.S. banking—reduces dependence on any single revenue source. Durable fee-based growth (AUM and advisory) supports recurring, less rate-sensitive earnings over the next several quarters.
Read all positive factors
Bank Of Montreal (BMO) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$166.13B
Dividend Yield3.61%
Average Volume (3M)2.46M
Price to Earnings (P/E)17.0
Beta (1Y)1.00
Revenue Growth-4.35%
EPS Growth21.22%
CountryCA
Employees53,597
SectorFinancial
Sector Strength70
IndustryBanks - Diversified
Share Statistics
EPS (TTM)13.06
Shares Outstanding706,195,740
10 Day Avg. Volume1,671,537
30 Day Avg. Volume2,459,003
Financial Highlights & Ratios
PEG Ratio0.71
Price to Book (P/B)1.43
Price to Sales (P/S)1.61
P/FCF Ratio14.78
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$228.33Price Target Upside9.70% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)14.49
Revenue Forecast (FY)C$38.82B
Bank Of Montreal Business Overview & Revenue Model
Company Description
Bank of Montreal is a diversified financial services institution primarily serving North America. For individual customers, BMO offers core banking products such as checking and savings accounts, credit cards, mortgages, and specialized financial ...
How the Company Makes Money
BMO generates revenue mainly from (1) net interest income, (2) non-interest (fee-based) income, and (3) trading/investment-related income, with results influenced by credit performance and market conditions.
1) Net interest income (core banking s...
Bank Of Montreal Earnings Call Summary
Earnings Call Date:May 27, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 25, 2026
Earnings Call Sentiment Positive
The call presented materially positive operating and capital trends: strong adjusted EPS growth (+40%), record PPPT and net income, large ROE and ROTCE improvements, positive operating leverage and clear segment-level momentum (Wealth, Capital Markets, U.S. Banking, Canadian P&C). Management is executing on optimization actions (asset sales, deposit mix changes), returning capital via buybacks and a dividend increase, and investing in digital/AI capabilities. Offsets include elevated PCL in unsecured consumer cards and some sequential NIM pressure from higher liquidity and mix shifts, plus ongoing economic/geopolitical uncertainty. On balance, the positives (earnings, returns, capital actions, diversified fee growth) significantly outweigh the headwinds, supporting a constructive outlook while acknowledging near-term credit and margin sensitivity.Positive Updates
Strong Earnings and EPS Growth
Adjusted EPS of $3.67, up 40% year-over-year; pre-provision pre-tax earnings (PPPT) of $4.4 billion, up 16% year-over-year; management reported record net income of ~$2.7 billion (adjusted) with reported net income of $2.6 billion.
Negative Updates
Elevated Provision for Credit Losses in Unsecured Consumer Book
Total provision for credit losses (PCL) was $739 million (45 basis points), stable quarter-over-quarter; elevated pressure in unsecured consumer portfolios with higher delinquencies driven by rising insolvencies and regional unemployment (notably parts of the GTA); card PCLs moved up materially in the quarter.
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Q2-2026 Updates
Positive
Negative
Strong Earnings and EPS Growth
Adjusted EPS of $3.67, up 40% year-over-year; pre-provision pre-tax earnings (PPPT) of $4.4 billion, up 16% year-over-year; management reported record net income of ~$2.7 billion (adjusted) with reported net income of $2.6 billion.
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Company Guidance
The management guidance emphasized a clear path to a 15% ROE exit target by FY2027, supported by current momentum: Q2 adjusted EPS $3.67 (+40% YoY), reported EPS $3.53, record net income ~$2.7B, PPPT $4.4B (+16%), ROE 13.5% (+370 bps YoY), ROTCE 17.6% (+480 bps) and ROA 73 bps. Revenue grew 10% (12% constant currency) with NII ex-markets +4% and NIM ex-markets 229 bps (+12 bps YoY), NIR +20% (24% ex-trading); expenses +6% (3% ex-FX & higher performance comp) yielding a 54.4% efficiency ratio and +4.1% operating leverage. Credit guidance: total PCL $739M (45 bps), impaired provisions ~$734M, performing loan coverage 69 bps, $4.7B performing allowance, gross impaired loans $6.9B (101 bps) on a $685B loan book, with impaired provisions expected to stay in the mid-40s bps over the next couple of quarters. Capital and capital actions: CET1 13% (12.5–13% target range) with +30 bps internal generation this quarter, a ~28 bps pro forma boost from the Transportation/vendor finance sale (accretive ~30 bps ROE), 6M shares repurchased and a 5% dividend increase to $1.71; other operational targets include full-year mid-single-digit core expense growth, ~$250M annualized efficiency savings (half to be realized this year), sequential commercial loan growth (U.S. +4% as‑at, Canada +2% as‑at), and continued deposit and wealth traction (Canadian retail core deposits +7%, commercial +8%; U.S. core retail deposits +4%; AUM +30%; mutual fund sales +49%; Wealth earnings +39%).Bank Of Montreal Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
63
Positive
Cash Flow
68
Positive
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 77.04B | 78.15B | 78.56B | 29.02B | 26.26B | 26.91B |
| Gross Profit | 34.47B | 32.48B | 28.28B | 29.64B | 25.69B | 26.91B |
| EBITDA | 14.79B | 12.39B | 11.18B | 7.71B | 19.09B | 11.44B |
| Net Income | 9.73B | 8.71B | 7.32B | 4.42B | 13.54B | 7.75B |
Balance Sheet | ||||||
| Total Assets | 1.50T | 1.48T | 1.41T | 1.29T | 1.14T | 988.17B |
| Cash, Cash Equivalents and Short-Term Investments | 393.40B | 104.16B | 113.53B | 114.31B | 118.21B | 121.97B |
| Total Debt | 166.59B | 415.19B | 262.44B | 248.74B | 222.64B | 189.81B |
| Total Liabilities | 1.41T | 1.39T | 1.33T | 1.22T | 1.07T | 930.65B |
| Stockholders Equity | 85.57B | 88.05B | 84.25B | 77.01B | 71.04B | 57.52B |
Cash Flow | ||||||
| Free Cash Flow | 39.30B | 8.51B | 27.47B | 19.59B | 3.51B | 43.07B |
| Operating Cash Flow | 41.06B | 10.24B | 29.03B | 21.27B | 4.96B | 44.05B |
| Investing Cash Flow | -38.62B | 605.00M | -24.53B | -21.16B | -29.47B | -299.00M |
| Financing Cash Flow | -2.93B | -8.67B | -17.41B | 268.00M | 15.98B | 47.12B |
Bank Of Montreal Technical Analysis
Positive
208.15
Price Trends
212.03
Positive
201.08
Positive
187.40
Positive
Market Momentum
6.22
Negative
74.56
Negative
83.90
Negative
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 208.15 is below the 20-day moving average (MA) of 224.89, below the 50-day MA of 212.03, and above the 200-day MA of 187.40, indicating a bullish trend. The MACD of 6.22 indicates Negative momentum. The RSI at 74.56 is Negative, neither overbought nor oversold. The STOCH value of 83.90 is Negative, 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
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | C$166.13B | 17.00 | 11.25% | 3.61% | -4.35% | 21.22% | |
72 Outperform | C$389.56B | 17.53 | 15.95% | 2.58% | 1.99% | 22.50% | |
71 Outperform | C$81.25B | 17.69 | 13.77% | 2.64% | 6.36% | 7.80% | |
70 Outperform | C$147.06B | 14.87 | 15.24% | 3.07% | -3.32% | 27.25% | |
69 Neutral | C$144.74B | 15.25 | 11.06% | 4.32% | -5.52% | 47.19% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | C$277.09B | 18.30 | 11.85% | 3.34% | -11.69% | -11.99% |
* Financial Sector Average
TSE:BMO
Bank Of Montreal
235.49
95.80
68.58%
TSE:BNS
Bank Of Nova Scotia
118.38
47.68
67.43%
TSE:CM
Canadian Bank of Commerce
159.15
68.73
76.01%
TSE:RY
Royal Bank Of Canada
278.46
108.94
64.26%
TSE:TD
Toronto Dominion Bank
164.27
70.89
75.92%
TSE:NA
National Bank of Canada
211.07
79.59
60.54%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.