Bank of Montreal Q3 profit up on improved credit performance
Bank of Montreal Q3 profit up on improved credit performance
Overview
Canada banking group's fiscal Q3 revenue rose and beat analyst expectations
Adjusted EPS for fiscal Q3 increased 22% yr/yr, driven by strong segment performance
Company repurchased 3.8 mln shares and announced intention for new buyback program
Outlook
Bank of Montreal did not provide specific financial guidance for upcoming quarters or the full year
Result Drivers
GOODWILL CHARGE - Reported net income fell due to a charge related to the reduction in goodwill from the sale of Transportation and Vendor Finance businesses
SEGMENT GROWTH - Adjusted results rose as every business segment delivered record pre-provision pre-tax earnings, with sustained momentum in Capital Markets and Wealth Management, and continued commercial loan growth in Canada and the U.S.
IMPROVED CREDIT PERFORMANCE - Lower provision for credit losses reflected proactive risk management and a well-diversified portfolio
Company press release: ID:nCNWq7Tv0a
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Beat | C$9.90 bln | C$9.75 bln (10 Analysts) |
Q3 Provision of credit loss |
| C$722 mln |
|
Q3 ROE |
| 8.40% |
|
Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 5 "strong buy" or "buy", 9 "hold" and 2 "sell" or "strong sell"
The average consensus recommendation for the banks peer group is "buy."
Wall Street's median 12-month price target for Bank of Montreal is C$260.00, about 9% above its August 24 closing price of C$238.63
The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 14 three months ago
Reuters Recommended Reads
Aug 24 - Deutsche Bank's €500 million buyback to begin on Tuesday
Aug 25 - Australian bank investors brace for tough times as mortgage demand plummets
Aug 25 - India's Axis Bank bets on data centres to gold loans to outpace industry credit growth
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)