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Investing.com - BofA Securities has raised its price target on Bank of Montreal (NYSE:BMO) to $128.00 from $116.00 while maintaining a Neutral rating on the stock. The bank, currently valued at $86 billion, is trading near its 52-week high of $119.41 and has delivered an impressive 50% return over the past year. According to InvestingPro analysis, BMO appears slightly undervalued based on its Fair Value metrics.
The bank’s Common Equity Tier 1 (CET1) ratio remained flat at 13.5%, which is above its 12.5% operating target and 11.5% regulatory minimum, according to the BofA Securities analyst note. During the quarter, Bank of Montreal repurchased 6 million shares, representing approximately 1% of outstanding shares. The bank has maintained dividend payments for 53 consecutive years, demonstrating strong financial stability. Get access to 12 more exclusive InvestingPro Tips and comprehensive analysis in the Pro Research Report.
Management announced a new Normal Course Issuer Bid (NCIB) of 30 million shares, which BofA Securities expects will be completed by the end of fiscal year 2026. The firm raised its fiscal year 2026/2027 earnings per share estimates to $13.55/$15.15 from $13.25/$14.60, citing an improved credit outlook in the United States.
The stock is currently trading at 12.2 times fiscal year 2026 estimated price-to-earnings ratio versus BofA’s forecast for 15% year-over-year EPS growth for fiscal year 2026. It trades at 1.4 times year-end 2026 price-to-book value versus a 12% 2026/2027 average return on equity forecast.
BofA Securities raised its price objective to $176 from $159 on higher assigned multiples, increasing price-to-earnings to 13 times from 12 times and price-to-book to 1.5 times from 1.4 times, citing improving earnings per share and return on equity visibility.
In other recent news, Bank of Montreal reported better-than-expected financial results for the third quarter of 2025. The company’s earnings per share (EPS) reached $3.23, surpassing analysts’ forecasts of $2.96. Additionally, revenue came in at $8.99 billion, exceeding the projected $8.86 billion. These results highlight the bank’s strong financial performance during the quarter. Despite the positive earnings and revenue figures, there were minor fluctuations in the stock’s pre-market trading. The earnings call did not mention any significant mergers or acquisitions. Analysts have not provided any recent upgrades or downgrades for Bank of Montreal. These developments reflect the current state of the company as it continues to navigate the financial landscape.
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