| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 68 | 13.4x | 17.8x | Top tier | |
Growth | 45 | 63.7% | 7.1% | Around median | |
Quality | 62 | — | — | Around median | |
Safety | 9 | — | — | Bottom tier | |
Capital Return | 85 | 2.89% | 2.12% | Top tier | |
Momentum | 94 | 43.3% | 2.9% | Top tier | |
Sentiment | 62 | 8 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Bank of Montreal (BMO) is a diversified banking group in Canada and the United States, generating income from net interest income on loans and deposits, as well as wealth and asset management fees, transaction banking, and capital markets. Its business drivers include Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management, and Capital Markets; all four operating segments delivered record pre-provision, pre-tax earnings in Q3 fiscal 2026.
In Q3 fiscal 2026, revenue was C$9.9 billion versus estimates of C$9.73 billion, and adjusted revenue grew 11% year over year. Adjusted net income reached a record C$2.859 billion, up 19%, and adjusted earnings per share rose 22% to $3.96; by contrast, reported net income was $1.8 billion and reported earnings per share were $2.38 due to adjusting charges that included $973 million largely related to accounting goodwill for the transportation finance and vendor finance businesses announced for sale.
Pre-provision, pre-tax earnings rose 13% to $4.5 billion, and adjusted return on equity was 14%, representing a year-over-year increase of 200 basis points. The efficiency ratio improved to 54.9%, positive operating leverage was 1.6%, while net interest margin excluding markets reached 226 basis points, up 5 basis points year over year and down 3 basis points sequentially. Within the business mix, net income from Canadian Personal and Commercial Banking grew 15%, U.S. Banking 9%, Wealth Management 22%, and Capital Markets 45%.
The analyst consensus is “Buy,” with an average price target of $117 and a wide range between $74 and $203. The average target is below the 52-week range high of $187.22, while the highest target exceeds that high; this divergence indicates fundamental disagreement over BMO's ability to achieve a 15% return on equity by the end of fiscal 2027 and balance credit and margin risks. The price-to-earnings multiple is not used as an anchor in this comparison because the data does not provide a figure for it.
Figures in the text are as of 2026-08-26; the live price is shown at the top of the page.
BMO reported revenue of C$9.9 billion, exceeding FactSet estimates of C$9.73 billion. Adjusted net income was C$2.859 billion, up 19%, and adjusted earnings per share rose 22% to $3.96. On a reported basis, net income was $1.8 billion and earnings per share were $2.38 due to adjusting items that included a $973 million charge primarily related to accounting goodwill for businesses announced for sale.
Management reaffirmed its target of achieving a sustainable return on equity of 15% by the end of fiscal 2027, compared with an adjusted return of 14% in Q3 fiscal 2026. The path depends on diversified revenue growth, expense discipline, risk management, and reallocating capital to higher-return opportunities. Management expects the sales of branches, finance businesses, and Moneris Canada to add approximately 50 basis points to the Common Equity Tier 1 ratio upon closing.
Total provisions for credit losses declined to $722 million from $739 million in the prior quarter, and provisions for impaired loans fell to $708 million. Gross impaired loans were $6.8 billion, or 97 basis points, down 4 basis points sequentially, and the commercial watchlist also declined by $1 billion. However, consumer insolvencies remained elevated, and management expects provisions for impaired loans in Q4 fiscal 2026 to be in line with Q3.
Automated analysis for informational purposes only — not investment advice.
U.S. commercial loans grew 4% sequentially in Q3 fiscal 2026, transaction banking revenue rose 15% year over year, and core retail customer deposits increased 2%. Return on equity for the U.S. business was 9.8%, and return on tangible common equity was 17.3%. Management says the path toward a 12% return is distributed approximately evenly among customer balance growth, fee income growth, improved efficiency, and normalization of credit provisions.
The transactions include the sale of 138 U.S. branches outside core markets, the transportation finance and vendor finance businesses, and Moneris Canada. Management expects these transactions to add 50 basis points to the Common Equity Tier 1 ratio and support return on equity after closing. Management estimated that approximately two-thirds of lost earnings relate to U.S. Banking and the remaining one-third to Canadian Personal and Commercial Banking, while the growth commitments presented at Investor Day remain unchanged.
In Q3 fiscal 2026, BMO Insurance launched the SmartDecision platform, which uses predictive modeling to deliver underwriting decisions within 10 seconds, compared with an industry average of 28 business days or more. The Lumi bot for frontline employees also increased new employee productivity by 17% by facilitating access to policy information. Lumi is being expanded to support customer conversations, beginning with mortgage renewals.
