BMO Q4 Earnings Preview: What to Expect

Bank of Montreal (BMO), the fourth largest bank in Canada, will report fourth-quarter financial results on December 3 before the opening bell.

Stock Performance

Year-to-date, the bank stock has jumped by more than 40% and is currently trading close to C$135. Strong earnings could drive BMO stock price higher, so let’s have a look at what analysts are expecting. (See Analysts’ Top Stocks on TipRanks)

Analyst Estimates

Analysts on average expect BMO to report adjusted earnings of C$3.21 per share in Q4 2021, which would represent a growth of 33.2% from the prior-year quarter (C$2.41 per share).

The estimated revenue is C$6.59 billion, indicating an increase of 8.7% from C$6.06 billion in the fourth quarter of 2020.

BMO beat estimates in the past five quarters, and has good chances of beating them in the coming quarter based on recent earnings estimate revisions.

Points to Watch

All the other Canadian big banks have increased their dividend, and BMO is also expected to hike its dividend.

Analysts are also closely watching loan growth, cost inflation and any insights on the pace of the recovery.

Wall Street’s Take

On November 25, Canaccord Genuity analyst Scott Chan maintained a Buy rating on BMO and set a price target of C$152. This implies 12.3% upside potential.

Chan expects BMO to post earnings per share of C$3.42 for the fourth quarter of 2021.

The rest of the Street is cautiously optimistic on BMO with a Moderate Buy consensus rating based on four Buys and two Holds. The average Bank of Montreal price target of C$137.66 implies 1.7% upside potential to current levels.