Bank of Montreal (NYSE:BMO) Shares Gap Down on Disappointing Earnings

Bank of Montreal (NYSE:BMO) (TSE:BMO)’s stock price gapped down prior to trading on Tuesday following a dissappointing earnings announcement. The stock had previously closed at $88.77, but opened at $86.09. Bank of Montreal shares last traded at $83.43, with a volume of 496,157 shares trading hands.

The bank reported $2.64 earnings per share (EPS) for the quarter, missing the consensus estimate of $2.76 by ($0.12). Bank of Montreal had a net margin of 8.25% and a return on equity of 11.60%. The firm had revenue of $8.21 billion during the quarter, compared to analyst estimates of $8.25 billion. During the same period last year, the business earned $2.08 EPS. The firm’s revenue was up .2% compared to the same quarter last year.

Bank of Montreal Cuts Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Tuesday, November 26th. Shareholders of record on Wednesday, October 30th will be given a $1.123 dividend. This represents a $4.49 annualized dividend and a yield of 5.48%. The ex-dividend date of this dividend is Wednesday, October 30th. Bank of Montreal’s dividend payout ratio (DPR) is 75.25%.

Analyst Ratings Changes

Several research firms have recently commented on BMO. Royal Bank of Canada cut Bank of Montreal from an “outperform” rating to a “sector perform” rating in a research note on Tuesday, July 30th. Keefe, Bruyette & Woods cut Bank of Montreal from an “outperform” rating to a “market perform” rating and reduced their target price for the company from $137.00 to $124.00 in a research note on Monday, June 3rd. Desjardins cut Bank of Montreal from a “buy” rating to a “hold” rating in a research note on Wednesday, May 29th. Bank of America cut Bank of Montreal from a “buy” rating to a “neutral” rating and reduced their target price for the company from $134.00 to $117.00 in a research note on Wednesday. Finally, Barclays reduced their target price on Bank of Montreal from $132.00 to $126.00 and set an “overweight” rating for the company in a research note on Wednesday. Nine analysts have rated the stock with a hold rating and two have issued a buy rating to the stock. According to data from MarketBeat.com, Bank of Montreal has a consensus rating of “Hold” and an average target price of $119.75.

Institutional Investors Weigh In On Bank of Montreal

A number of hedge funds have recently added to or reduced their stakes in BMO. Principal Securities Inc. bought a new stake in Bank of Montreal in the fourth quarter valued at $33,000. Rothschild Investment LLC acquired a new position in shares of Bank of Montreal during the second quarter valued at $40,000. Cullen Frost Bankers Inc. increased its holdings in shares of Bank of Montreal by 3,375.0% during the fourth quarter. Cullen Frost Bankers Inc. now owns 417 shares of the bank’s stock valued at $41,000 after purchasing an additional 405 shares during the period. Headlands Technologies LLC acquired a new position in shares of Bank of Montreal during the fourth quarter valued at $44,000. Finally, EverSource Wealth Advisors LLC increased its holdings in shares of Bank of Montreal by 39.0% during the fourth quarter. EverSource Wealth Advisors LLC now owns 463 shares of the bank’s stock valued at $46,000 after purchasing an additional 130 shares during the period. 45.82% of the stock is currently owned by institutional investors.

Bank of Montreal Price Performance

The company has a market capitalization of $59.73 billion, a price-to-earnings ratio of 13.60, a price-to-earnings-growth ratio of 2.04 and a beta of 1.12. The company has a debt-to-equity ratio of 0.12, a current ratio of 0.99 and a quick ratio of 0.99. The business has a fifty day moving average price of $84.74 and a 200 day moving average price of $89.80.

Bank of Montreal Company Profile

Bank of Montreal provides diversified financial services primarily in North America. It operates through Canadian P&C, U.S P&C, BMO Wealth Management, and BMO Capital Markets segments. The company’s personal banking products and services include deposits, mortgages, home lending, consumer credit, small business lending, credit cards, cash management, financial and investment advice, and other banking services; and commercial banking products and services comprise various of financing options and treasury and payment solutions, as well as risk management products.