Bank Of Montreal (BMO) AI Stock Analysis

• Market Cap: C$126.47B
• Dividend Yield: 3.61%
• Average Volume (3M): 2.18M
• Price to Earnings (P/E): 15.6
• Beta (1Y): 1.16
• Revenue Growth: -1.30%
• EPS Growth: 20.41%
• Country: CA
• Employees: 53,597
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Diversified
• EPS (TTM): 3.28
• Shares Outstanding: 708,905,700
• 10 Day Avg. Volume: 2,036,507
• 30 Day Avg. Volume: 2,180,863
• PEG Ratio: 0.71
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 1.61
• P/FCF Ratio: 14.78
• 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$184.20
• Price Target Upside: 3.25% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 10
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 74 Outperform
• Price Target: C$200.00 ▲(12.11% Upside)

Bank of Montreal's strong earnings growth and strategic focus on digital and AI advancements are significant strengths, contributing positively to the stock score. The solid financial position and attractive dividend yield further support the score. However, challenges in revenue growth, profitability margins, and macroeconomic uncertainties slightly temper the overall outlook.

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 tools improves operational efficiency and customer service, positioning BMO for future growth in a tech-driven market.

Shareholder Returns

Strong capital returns through dividends and buybacks demonstrate financial health and commitment to enhancing shareholder value.

Negative Factors

Revenue Growth Challenges

Inconsistent revenue growth can hinder long-term financial performance, requiring strategic adjustments to sustain growth.

High Leverage

High leverage poses risks to financial stability, potentially limiting flexibility in adverse economic conditions.

Credit Card Delinquencies

Rising delinquencies can impact profitability and risk management, necessitating improved credit controls and economic resilience.

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 net interest income and non-interest income. Net interest income is earned from the difference between the interest it collects on loans and the interest it pays on deposits. This includes personal loans, mortgages, and commercial loans. Non-interest income comes from fees for services such as wealth management, investment advice, and trading services, as well as transaction fees from credit card usage and account maintenance. Additionally, BMO's Capital Markets division contributes significantly to its earnings through investment banking, trading, and advisory services. The bank also benefits from strategic partnerships with other financial institutions and technology firms that enhance its service offerings and operational efficiency, driving further revenue growth.

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

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

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

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.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	78.15B	78.56B	29.02B	26.26B	26.91B
Gross Profit	32.48B	28.28B	29.64B	25.95B	26.91B
EBITDA	13.73B	11.18B	7.71B	19.09B	11.44B
Net Income	8.71B	7.32B	4.42B	13.54B	7.75B
Balance Sheet
Total Assets	1.48T	1.41T	1.29T	1.14T	988.17B
Cash, Cash Equivalents and Short-Term Investments	104.16B	113.53B	114.31B	118.21B	121.97B
Total Debt	415.19B	262.44B	248.74B	222.64B	189.81B
Total Liabilities	1.39T	1.33T	1.22T	1.07T	930.65B
Stockholders Equity	88.05B	84.25B	77.01B	71.04B	57.52B
Cash Flow
Free Cash Flow	8.51B	27.47B	19.59B	3.51B	43.07B
Operating Cash Flow	10.24B	29.03B	21.27B	4.96B	44.05B
Investing Cash Flow	605.00M	-24.53B	-21.16B	-29.47B	-299.00M
Financing Cash Flow	-8.67B	-17.41B	268.00M	15.98B	47.12B

Bank Of Montreal Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 178.40
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• 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 178.4 is above the 20-day moving average (MA) of 177.88, above the 50-day MA of 175.44, and above the 200-day MA of 155.94, indicating a bullish trend. The MACD of 1.05 indicates Positive momentum. The RSI at 53.58 is Neutral, neither overbought nor oversold. The STOCH value of 35.93 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
NA	78 Outperform	$68.73B	17.30	13.53%	2.64%	7.50%	-5.28%
BNS	77 Outperform	C$125.25B	17.36	9.19%	4.32%	-3.65%	-1.73%
RY	75 Outperform	$327.44B	16.58	15.28%	2.58%	2.13%	25.16%
CM	74 Outperform	C$117.32B	14.68	13.69%	3.07%	-3.13%	18.22%
TD	74 Outperform	$218.22B	11.16	16.78%	3.34%	3.07%	144.41%
BMO	74 Outperform	C$126.47B	15.57	10.10%	3.61%	-1.30%	20.41%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Bank Of Montreal Corporate Events

BMO Financial Group Reports Strong Fiscal 2025 Results

BMO Financial Group reported strong financial results for the fourth quarter and fiscal year 2025, with significant increases in adjusted net income and earnings per share compared to the previous year. The company demonstrated robust earnings growth and improved return on equity, driven by pre-provision, pre-tax earnings expansion and positive operating leverage. BMO’s strategic focus on digital and AI-powered solutions, along with its financial strength and talent acquisition, positions it well for continued growth and shareholder value creation in 2026.

BMO Increases Quarterly Dividend, Enhancing Shareholder Value

Bank of Montreal announced an increase in its quarterly dividend to $1.67 per common share, marking a 2% rise from the previous quarter and a 5% increase from the prior year. This decision reflects BMO’s strong financial performance and commitment to returning value to shareholders. The dividends are designated as eligible for tax purposes, and shareholders have the option to reinvest dividends in common shares through the bank’s Dividend Reinvestment and Share Purchase Plan.

Bank of Montreal Boosts Quarterly Dividend for Fiscal 2026

Bank of Montreal announced an increase in its quarterly dividend by 4 cents to $1.67 per share for the first quarter of fiscal year 2026, reflecting a 2 percent rise from the previous quarter and a 5 percent increase from the prior year. This move highlights BMO’s commitment to returning value to shareholders and strengthening its market position. The dividends are designated as eligible under Canadian tax legislation, and shareholders have the option to reinvest dividends through the bank’s dividend reinvestment plan.