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Bank Of Montreal (TSE:BMO)
TSX:BMO

Bank Of Montreal (BMO) AI Stock Analysis

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TSE:BMO

Bank Of Montreal

(TSX:BMO)

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Neutral 69 (OpenAI - 4o)
Rating:69Neutral
Price Target:
C$196.00
â–²(10.31% Upside)
The Bank of Montreal's stock score is driven by strong earnings growth and strategic advancements in digital and AI, as highlighted in the earnings call. Solid technical indicators and a reasonable valuation further support the stock's performance. However, high leverage and economic challenges in Canada pose risks.
Positive Factors
Earnings Growth
Strong earnings growth indicates effective cost management and revenue generation, enhancing long-term profitability and shareholder value.
Digital and AI Strategy
Investment in digital and AI capabilities positions BMO for enhanced operational efficiency and improved customer service, supporting sustainable growth.
Shareholder Returns
Consistent shareholder returns through dividends and buybacks reflect strong cash flow and commitment to returning value to investors.
Negative Factors
High Leverage
High leverage can increase financial risk, especially in rising interest rate environments, potentially impacting long-term financial stability.
Challenges in Canadian Economy
Economic challenges in Canada could affect BMO's domestic operations, impacting loan growth and credit quality, posing long-term risks.
Credit Card Delinquencies
Rising credit card delinquencies suggest potential credit risk, which may lead to increased provisions and impact future profitability.

Bank Of Montreal (BMO) vs. iShares MSCI Canada ETF (EWC)

Bank Of Montreal Business Overview & Revenue Model

Company DescriptionBank 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 MoneyBMO generates revenue through various streams, primarily from interest income and non-interest income. Interest income comes from the loans it extends to customers, including personal loans, mortgages, and commercial loans, which are repaid with interest over time. Non-interest income includes fees from account services, transaction fees, investment management fees, and trading income from its capital markets division. Additionally, BMO benefits from partnerships with other financial institutions and businesses, providing investment banking and advisory services. The bank also sees significant contributions from its wealth management services, which cater to both individual and institutional clients, thereby diversifying its revenue sources.

Bank Of Montreal Earnings Call Summary

Earnings Call Date:Dec 04, 2025
(Q4-2025)
|
% Change Since: |
Next Earnings Date:Mar 03, 2026
Earnings Call Sentiment Positive
The earnings call highlighted significant achievements in earnings growth, ROE improvement, and strategic initiatives, especially in digital and AI advancements. However, challenges in the Canadian economy and credit card delinquencies, along with macroeconomic uncertainties, were notable concerns.
Q4-2025 Updates
Positive Updates
Strong Earnings Growth
BMO reported an adjusted EPS of $3.28 for Q4 2025, up significantly from $1.90 last year, with net income of $2.5 billion driven by strong PPPT growth of 16% and lower PCLs.
Increased Return on Equity
Full year ROE increased by 150 basis points from 9.8% to 11.3%, with Q4 momentum at 11.8%.
Record Net Income
Record net income of $9.2 billion for the year, with EPS growth of 26%.
Positive Operating Leverage
Achieved positive operating leverage of 4% for the year, with an efficiency ratio improvement of 230 basis points to 56.3%.
Capital Optimization and Shareholder Returns
Returned over $8 billion in capital to shareholders through buybacks and dividends, with a dividend increase of $0.04 to $1.67 per share.
Digital and AI Strategy
Introduced AI productivity tools to all employees, with over 80% active users, and implemented Gen AI tools like Lumi and Rover to enhance customer service.
Strong Wealth Management Performance
Wealth Management had a very strong year with record revenues and net income, driven by client asset growth and market conditions.
Negative Updates
Challenges in Canadian Economy
Softness in the Canadian economy, including rising unemployment and trade uncertainty, resulted in higher losses in Canadian Personal and Commercial business.
Credit Card Delinquencies
Higher delinquency rates in the Canadian credit card book, attributed to macroeconomic conditions affecting mass consumers.
Asset Sale and Goodwill Write-down
Goodwill write-down related to the announced sale of certain U.S. branches.
Economic Uncertainty Impacting Loan Growth
Trade uncertainty and subdued consumer sentiment impacting loan growth, particularly in Canada.
Company Guidance
During the BMO Financial Group's Q4 2025 earnings call, CEO Darryl White highlighted several key metrics reflecting the bank's strong performance. The bank reported an adjusted EPS of $3.28 for Q4 and $12.16 for the fiscal year, marking a 26% growth in EPS and a record net income of $9.2 billion. BMO achieved a full-year ROE increase from 9.8% to 11.3%, exiting Q4 with an ROE of 11.8%. Pre-Provision Pre-Tax (PPPT) earnings rose by 18% to $15.8 billion. The bank also achieved positive operating leverage of 4%, with an improved efficiency ratio of 56.3%. BMO's credit performance showed impaired provisions at 44 basis points, and the bank returned over $8 billion to shareholders through buybacks and dividends, increasing the dividend by $0.04 to $1.67 per share. The CET1 ratio remained strong at 13.3%. The bank's digital-first AI-powered strategy and investments in AI capabilities were also emphasized as key drivers of operational efficiency and client service enhancements.

Bank Of Montreal Financial Statement Overview

Summary
The Bank of Montreal shows solid profitability with stable margins and strong free cash flow growth, despite a decline in revenue growth and high leverage. The high debt-to-equity ratio poses a risk, but the bank's ability to generate returns on equity and maintain healthy margins provides a buffer.
Income Statement
65
Positive
The Bank of Montreal's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) data indicates a decline in revenue growth rate by 0.59%, which is concerning. However, the bank maintains a stable gross profit margin of 39.15% and a net profit margin of 11.09%, reflecting good profitability. The EBIT and EBITDA margins are also healthy at 14.50% and 17.23%, respectively, indicating efficient operations. Despite the revenue decline, the bank's profitability metrics remain robust.
Balance Sheet
55
Neutral
The balance sheet reveals a high debt-to-equity ratio of 4.54, which suggests significant leverage and potential risk if interest rates rise. However, the return on equity (ROE) stands at 10.13%, indicating that the bank is generating decent returns on its equity. The equity ratio is relatively low, which could imply a higher reliance on debt financing. Overall, while the bank is profitable, its high leverage poses a risk.
Cash Flow
70
Positive
The cash flow statement shows a strong free cash flow growth rate of 1543.05% in the TTM period, indicating substantial improvement in cash generation. The operating cash flow to net income ratio is low at 0.20%, suggesting that not all earnings are being converted into cash. However, the free cash flow to net income ratio is 23.76%, showing that a significant portion of earnings is available as free cash flow. The cash flow position is strong, but the conversion of operating cash flow to net income could be improved.
BreakdownDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue78.15B78.56B29.02B26.26B26.91B
Gross Profit32.48B28.28B29.64B25.95B26.91B
EBITDA13.73B11.18B7.71B19.09B11.44B
Net Income8.71B7.32B4.42B13.54B7.75B
Balance Sheet
Total Assets1.48T1.41T1.29T1.14T988.17B
Cash, Cash Equivalents and Short-Term Investments104.16B113.53B114.31B118.21B121.97B
Total Debt415.19B262.44B248.74B222.64B189.81B
Total Liabilities1.39T1.33T1.22T1.07T930.65B
Stockholders Equity88.05B84.25B77.01B71.04B57.52B
Cash Flow
Free Cash Flow8.51B27.47B19.59B3.51B43.07B
Operating Cash Flow10.24B29.03B21.27B4.96B44.05B
Investing Cash Flow605.00M-24.53B-21.16B-29.47B-299.00M
Financing Cash Flow-8.67B-17.41B268.00M15.98B47.12B

Bank Of Montreal Technical Analysis

Technical Analysis Sentiment
Positive
Last Price177.68
Price Trends
50DMA
175.28
Positive
100DMA
171.03
Positive
200DMA
155.08
Positive
Market Momentum
MACD
1.32
Negative
RSI
52.28
Neutral
STOCH
42.97
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 177.68 is above the 20-day moving average (MA) of 176.87, above the 50-day MA of 175.28, and above the 200-day MA of 155.08, indicating a bullish trend. The MACD of 1.32 indicates Negative momentum. The RSI at 52.28 is Neutral, neither overbought nor oversold. The STOCH value of 42.97 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

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
C$67.26B16.9313.53%2.67%7.50%-5.28%
77
Outperform
C$121.79B16.889.19%4.32%-3.65%-1.73%
75
Outperform
$319.05B16.1615.28%2.62%2.13%25.16%
74
Outperform
C$116.97B14.6413.69%3.07%-3.13%18.22%
74
Outperform
C$212.50B10.8716.78%3.34%3.07%144.41%
69
Neutral
$125.50B15.4510.10%3.62%-1.30%20.41%
68
Neutral
$18.00B11.429.92%3.81%9.73%1.22%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:BMO
Bank Of Montreal
177.68
44.67
33.58%
TSE:BNS
Bank Of Nova Scotia
99.34
26.48
36.34%
TSE:CM
Canadian Bank of Commerce
127.27
38.51
43.38%
TSE:RY
Royal Bank Of Canada
230.36
62.67
37.37%
TSE:TD
Toronto Dominion Bank
127.49
55.86
77.99%
TSE:NA
National Bank of Canada
173.57
46.15
36.22%

Bank Of Montreal Corporate Events

Business Operations and StrategyPrivate Placements and Financing
Bank of Montreal Issues EUR 1 Billion Callable Notes
Positive
Oct 28, 2025

Bank of Montreal has announced the issuance of EUR 1 billion Callable Floating Rate Senior Notes due in October 2029 as part of its extensive USD 40 billion Note Issuance Programme. This move is aligned with the bank’s strategy to strengthen its financial position and provide attractive investment opportunities, potentially impacting its market positioning and offering benefits to stakeholders.

Private Placements and Financing
Bank of Montreal Announces Pre-Stabilisation for EUR 1 Billion Notes
Neutral
Oct 24, 2025

Bank of Montreal’s London Branch has announced a pre-stabilisation notice for the issuance of EUR 1 billion Callable Floating Rate Senior Notes due October 2029. The stabilisation period for these securities is expected to commence on October 22, 2025, and may last up to 30 days post-issuance. The stabilisation manager, Bank of Montreal, London Branch, may engage in over-allotment or market-supporting transactions to maintain the securities’ market price. However, such actions are not guaranteed and will comply with applicable laws.

Private Placements and Financing
Bank of Montreal Announces Pre-Stabilisation for KFW Senior Notes
Neutral
Oct 24, 2025

Bank of Montreal Europe plc has announced a pre-stabilisation notice for the offer of GBP 200,000,000 0.125% Senior Notes due 30 December 2026, issued by Kreditanstalt für Wiederaufbau (KFW). The stabilisation period is expected to start on 23 October 2025 and may last up to 30 days after the proposed issue date. The Bank of Montreal Europe plc, acting as the Stabilising Manager, may over-allot the securities or engage in transactions to support the market price, although there is no guarantee that such actions will be taken. This announcement is intended for qualified investors and high net worth individuals in the UK and EEA, and does not constitute an offer to sell securities in the United States.

Private Placements and FinancingRegulatory Filings and Compliance
Bank of Montreal Announces No Stabilisation in Recent Note Offering
Neutral
Oct 15, 2025

Bank of Montreal’s London Branch announced that no stabilisation actions were taken in relation to the offering of GBP 600,000,000 4.250% Senior Notes due in 2030 by PSP Capital Inc. This announcement clarifies the bank’s position in the transaction, ensuring transparency for stakeholders and maintaining compliance with the Financial Conduct Authority’s regulations.

Private Placements and Financing
Bank of Montreal Announces Pre-Stabilisation for Asian Development Bank Notes
Neutral
Oct 8, 2025

The Bank of Montreal, through its London Branch, announced a pre-stabilisation notice for the offering of CAD 750,000,000 2.600% notes due in 2028 issued by the Asian Development Bank. The stabilisation period is set to begin on October 10, 2025, and may last up to 30 days. The Bank of Montreal, acting as the Stabilising Manager, may engage in transactions to support the market price of the securities, although there is no guarantee that such actions will be taken. This announcement is directed at qualified investors and is not an offer for sale in the United States.

Business Operations and StrategyExecutive/Board Changes
BMO Financial Group Announces CFO Transition
Neutral
Sep 17, 2025

BMO Financial Group has announced the retirement of its Chief Financial Officer, Tayfun Tuzun, effective early 2026, and the appointment of Rahul Nalgirkar as his successor. Nalgirkar, who joined BMO in 2022, will assume the CFO role on January 1, 2026, after a transition period as Deputy CFO. This leadership change is significant as BMO continues to strengthen its position as one of North America’s largest banks, with a focus on strategic growth and operational efficiency.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$180.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

Private Placements and Financing
Bank of Montreal Announces Pre-Stabilisation for GBP 600 Million Note Offering
Neutral
Sep 16, 2025

Bank of Montreal’s London Branch has announced a pre-stabilisation notice for the offering of GBP 600,000,000 4.250% Senior Notes due in October 2030, issued by PSP Capital Inc. The stabilisation period is expected to start on September 15, 2025, and may last up to 30 days. The Bank of Montreal will act as the Stabilising Manager, with the possibility of over-allotting the securities to support market prices. This move is aimed at ensuring price stability in the market, although there is no guarantee that stabilisation actions will be undertaken.

Business Operations and StrategyPrivate Placements and Financing
Bank of Montreal Launches $50 Billion Covered Bond Program
Positive
Sep 11, 2025

Bank of Montreal has announced the publication of a prospectus for its $50 billion Global Registered Covered Bond Program, which has been approved by the Financial Conduct Authority. This program, guaranteed by BMO Covered Bond Guarantor Limited Partnership, signifies a strategic move to strengthen the bank’s funding capabilities and enhance its financial stability, potentially impacting its market positioning and stakeholder interests.

Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Bank of Montreal Publishes $50 Billion Covered Bond Program Prospectus
Positive
Sep 11, 2025

Bank of Montreal has announced the publication of a prospectus supplement for its $50 billion Global Registered Covered Bond Program, which has been approved by the Financial Conduct Authority. This move underscores the bank’s commitment to strengthening its financial instruments and enhancing its market position, potentially impacting stakeholders by providing more secure investment opportunities.

Business Operations and StrategyPrivate Placements and Financing
Bank of Montreal Issues GBP 500 Million Callable Notes
Positive
Sep 5, 2025

Bank of Montreal has announced the issuance of GBP 500,000,000 Callable Fixed to Floating Rate Senior Notes due October 2031 as part of its extensive U.S.$40,000,000,000 Note Issuance Programme. This strategic move is expected to enhance the bank’s financial flexibility and strengthen its market position, reflecting its commitment to expanding its financial offerings and maintaining robust stakeholder relations.

Business Operations and StrategyStock Buyback
Bank of Montreal Secures Approval for Share Repurchase Program
Positive
Sep 3, 2025

Bank of Montreal has received regulatory approvals for its Normal Course Issuer Bid, allowing the bank to repurchase its own shares. This move is likely to impact the company’s financial strategy and shareholder value, potentially enhancing its market position and signaling confidence in its financial health.

Bank of Montreal Reports Record Earnings Amid Challenges
Sep 1, 2025

The recent earnings call for the Bank of Montreal (BMO) painted a largely positive picture of the company’s financial health and strategic progress. The bank reported record net income and strong earnings growth, despite facing challenges in the Canadian market, such as higher provisions for credit losses and macroeconomic uncertainties. Overall, the sentiment was optimistic, buoyed by the bank’s robust financial performance and strategic advancements.

BMO Reports Strong Q3 2025 Earnings Growth
Aug 27, 2025

Bank of Montreal (BMO) is a leading financial services provider in North America, operating in the banking and financial services industry with a focus on personal and commercial banking, wealth management, and investment banking. The company is known for its strong presence in both Canada and the United States.

Business Operations and StrategyStock BuybackFinancial DisclosuresM&A Transactions
BMO Financial Group Reports Strong Q3 2025 Results and Strategic Growth Initiatives
Positive
Aug 26, 2025

BMO Financial Group reported strong financial results for the third quarter of 2025, with a 25% increase in reported net income and a 26% rise in earnings per share compared to the previous year. The company continues to focus on sustainable growth through strategic acquisitions, such as the recent agreement to acquire Burgundy Asset Management Ltd., and is enhancing its digital and AI capabilities to improve client experiences. Additionally, BMO announced plans to increase its share repurchase program, reflecting confidence in its financial position and commitment to returning capital to shareholders.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$170.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

Dividends
BMO Declares Steady Quarterly Dividends for Q4 2025
Neutral
Aug 26, 2025

Bank of Montreal announced that its Board of Directors has declared a quarterly dividend of $1.63 per common share for the fourth quarter of fiscal year 2025, maintaining the same rate as the previous quarter. Additionally, dividends were declared for various series of Class B Preferred Shares, with all dividends designated as ‘eligible’ for Canadian tax purposes. Shareholders have the option to reinvest their dividends in common shares through the Bank’s Dividend Reinvestment and Share Purchase Plan.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$170.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

Business Operations and StrategyStock Buyback
BMO to Initiate New Share Buyback Program
Positive
Aug 26, 2025

Bank of Montreal announced its plan to cancel its existing normal course issuer bid and establish a new one to purchase up to 30 million of its common shares, subject to regulatory approval. This move is intended to provide the bank with greater flexibility in managing its capital position, reflecting its proactive approach to capital management amidst changing market conditions.

The most recent analyst rating on (TSE:BMO) stock is a Buy with a C$170.00 price target. To see the full list of analyst forecasts on Bank Of Montreal stock, see the TSE:BMO Stock Forecast page.

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.Date of analysis: Dec 11, 2025