Bank of Montreal Stock: CIBC Sticks to Buy, Barclays Lifts Target as Seeking Alpha Downgrades BMO

Published: December 7, 2025

Bank of Montreal stock (TSX: BMO, NYSE: BMO) is ending 2025 with a mix of powerful fundamentals and sharply diverging analyst opinions. After a strong fourth-quarter earnings beat, a higher dividend and a 27%+ rally in the share price this year, some institutions are turning more bullish on BMO—while others are stepping back and calling the stock fully valued. ^[1]

Below is a look at how the latest calls from CIBC, Barclays and Seeking Alpha’s Wolf Report fit together, and what they might mean for investors following Bank of Montreal heading into 2026.

Key takeaways

Q4 2025 beat: BMO’s adjusted profit rose to roughly C$2.51 billion, or C$3.28 per share, driven by a near-doubling of capital markets earnings and lower provisions for credit losses. ^[2]
Dividend raised again: The bank increased its quarterly dividend by 4 cents to $1.67 per share for Q1 2026, marking another step-up in its long dividend growth history. ^[3]
CIBC stays bullish: CIBC analyst Paul Holden reiterated a Buy rating and a C$192 price target, while Canaccord also maintained a Buy stance, even as Bank of America kept a Hold. ^[4]
Barclays and BofA lift targets: Barclays raised its target from C$177 to C$181 with an Equal Weight rating, and Bank of America followed by moving its target up to C$183, both citing strong recent results. ^[5]
Seeking Alpha downgrade: In contrast, a widely read Wolf Report article on Seeking Alpha downgraded BMO to Hold, arguing that the stock looks significantly overvalued with limited upside after this year’s rally. ^[6]
Valuation debate heats up: BMO shares are up about 27–28% year-to-date, trading near 52‑week highs with a P/E around the mid‑teens. Some models still see roughly 30% upside to fair value, while others say expectations are already stretched. ^[7]

Strong Q4 2025 results set the stage

BMO’s latest numbers are the backdrop for all of the recent analyst calls. In its fiscal Q4 2025, the bank reported:

Adjusted net income of about C$2.51 billion, up strongly from the prior year.
Adjusted EPS of C$3.28, versus C$1.90 a year earlier, comfortably ahead of analyst expectations. ^[8]
Capital markets earnings that nearly doubled to about C$521 million, thanks to a rebound in dealmaking and stronger markets. ^[9]
Provisions for credit losses falling to roughly C$755 million from C$1.52 billion, signalling improved credit quality. ^[10]

BMO’s own release highlighted record full‑year net income, higher return on equity and a common equity tier 1 (CET1) capital ratio of 13.3%, even after share buybacks. ^[11]

Across the sector, Reuters notes that TD, BMO and CIBC all beat profit estimates as capital markets and wealth management offset a still-sluggish domestic economy. However, it also stresses that Canadian banks look “fully valued” after a big run-up in 2025, leaving less room for disappointment. ^[12]

Dividend hike underscores confidence

On the capital allocation side, Bank of Montreal is continuing to lean into its income story.

According to a recent company announcement recapped by TipRanks, BMO will increase its quarterly dividend by 4 cents to $1.67 per share starting in the first quarter of fiscal 2026—about a 2% rise from the previous quarter and roughly 5% higher than the dividend a year ago. ^[13]

The dividend is designated as an eligible dividend for Canadian tax purposes, and shareholders can reinvest their payouts through BMO’s dividend reinvestment plan. The bank’s yield is hovering around the mid‑3% range, and it has maintained an uninterrupted dividend stream for more than half a century. ^[14]

Taken together—earnings growth, a strong capital position and a rising dividend—BMO is signalling that it feels comfortable returning more cash to shareholders even as macro uncertainty remains.

CIBC sticks to a Buy rating and higher target

One of the freshest bullish voices comes from CIBC.

In a note highlighted by TipRanks, CIBC analyst Paul Holden reaffirmed his Buy rating on Bank of Montreal and set a C$192 price target. ^[15] That target sits well above where the stock is trading today and implies meaningful upside from current levels on the Toronto Stock Exchange.

The same TipRanks piece points out: ^[16]

Canaccord Genuity’s Matthew Lee is also positive on BMO with a Buy rating and an even higher target around the C$200 mark.
Bank of America Securities, by contrast, maintains a Hold stance despite its recent target hike.
On TipRanks’ aggregate view for BMO’s Toronto listing, the average 12‑month price target sits in the low‑to‑mid C$180s, with a majority of analysts rating the stock Hold and a smaller group at Buy.

TipRanks’ AI “Spark” tool currently flags BMO as an Outperform idea, citing strong financial performance and upbeat earnings-call tone, but also warning about high leverage and cash‑flow pressure as key risks. ^[17]

Barclays and Bank of America: higher targets, but tempered enthusiasm

Barclays and Bank of America have both nudged their expectations higher following BMO’s Q4 beat.

Barclays: Equal Weight, C$181 target

An Investing.com piece and a follow‑up report from MarketBeat show that Barclays raised its BMO price target from C$177 to C$181, keeping an Equal Weight rating. ^[18]

Barclays’ report highlights: ^[19]

BMO’s Q4 EPS of C$2.97, with adjusted EPS of C$3.28 coming in above consensus.
Adjusted revenue growth of around 12% year-on-year and 4% quarter-on-quarter.
A book value per share of roughly C$112, up about 3% from the previous quarter.
A CET1 ratio of about 13.3%, down slightly but still comfortably above regulatory minimums.
A valuation profile that includes a P/E around 15.5 and a notably low PEG ratio near 0.5, suggesting the stock trades at a modest multiple relative to near-term earnings growth expectations.

The brokerage notes that the stock is trading close to its 52‑week high (around C$182.90) and has delivered a mid‑30s percentage total return year-to-date, which limits upside in the near term despite solid fundamentals. ^[20]

Bank of America: Hold, C$183 target

A separate MarketBeat alert shows Bank of America lifting its BMO target from C$179 to C$183, also implying a modest upside of under 3% from recent prices. Street consensus, according to the same data set, remains a “Hold” with an average target around C$178.77, based on one Strong Buy, two Buy and nine Hold ratings. ^[21]

In other words, big global brokers acknowledge that BMO’s fundamentals justify a slightly higher valuation—but most are not yet ready to pound the table with a strong Buy call at current levels.

The contrarian view: Seeking Alpha downgrade and exits from bank exposure

On December 2, the tone from one corner of the investment community turned decidedly more cautious.

A Wolf Report article on Seeking Alpha—titled “Bank Of Montreal: Downgrading And Exiting Banks (Rating Downgrade)”—cut BMO from a more bullish stance down to Hold and announced an exit from Canadian bank positions in the author’s portfolio. ^[22]

While the full article sits behind a paywall, summaries on StockAnalysis and other aggregators indicate the core thesis: ^[23]

BMO is seen as “significantly overvalued”, with limited upside from current prices after its strong share‑price run.
The downgrade is part of a broader move to reduce or exit Canadian bank exposure, reflecting concerns about sector valuation and macro risks rather than company-specific distress.
The author highlights that he has been a long‑time holder of several Canadian banks, including TD, Scotiabank and BMO, making the decision more about portfolio rebalancing and risk management than a short‑term trading call.

This sceptical view echoes earlier cautious moves from other institutions. For example, National Bank Financial recently downgraded BMO from “outperform” to a more neutral “sector perform” while still raising its price target, and earlier this autumn RBC Capital Markets cut BMO on worries that earnings growth could lag expectations into 2027. ^[24]

Valuation: has the 2025 rally already priced in the good news?

The heart of the debate is valuation.

What the numbers say today

Across several recent reports and data services: ^[25]

BMO shares are up about 27–28% in 2025 and a similar amount over the past 12 months.
The stock trades near C$178 on the TSX, very close to its 52‑week high around C$183.
The price‑to‑earnings ratio sits in the mid‑teens, with a PEG ratio well below 1 on some estimates—typically a sign of growth that isn’t fully priced in.
The consensus 12‑month price target for the Canadian listing clusters in the C$178–C$185 range, only a few percentage points above the current quote.

Simply Wall St: still undervalued by ~30%?

Adding another dimension, Simply Wall St published fresh research on December 7 asking whether BMO’s 27% rally in 2025 has already captured its growth potential. ^[26]

Using an “Excess Returns” model based on:

Book value of about C$122 per share,
A long‑run ROE estimate around 12.2%, and
A cost of equity near 8.7%,

the service arrives at an intrinsic value near C$252 per share, suggesting that BMO could be roughly 29% undervalued even after its big run. ^[27]

Interestingly, the same analysis notes that BMO only passes 2 out of 6 of Simply Wall St’s valuation checks, illustrating how different models and assumptions can lead to very different conclusions about what “cheap” or “expensive” really means.

Risk backdrop: resilient earnings, but fully valued sector

More broadly, recent Reuters reporting on Canadian banks paints a mixed backdrop: ^[28]

All of the “Big Six” banks, including BMO, beat earnings expectations for fiscal 2025.
Capital‑markets and wealth‑management businesses are doing much of the heavy lifting as traditional loan growth stays subdued.
Share prices for the big banks have risen about 30% on average this year, outpacing the broader Toronto market.
Analysts worry that the group is “fully valued”, meaning any negative surprise—be it higher loan losses, slower fee income or new regulatory costs—could trigger a sharp pullback.

For BMO specifically, the strong U.S. and capital‑markets contributions are a clear positive. But investors must weigh that against macro risks, such as trade tensions, domestic housing pressures and the possibility that credit costs could drift higher again if the economy slows. ^[29]

How to interpret the split in analyst views

Putting everything together, here’s one way to read the current divergence:

The bull camp (CIBC, Canaccord, TipRanks AI, Simply Wall St)
- Focuses on earnings power, cross‑border growth and structurally higher returns on equity.
- Sees the current valuation as either reasonable or even below fair value, especially when compared with BMO’s long-term growth runway. ^[30]
The neutral camp (Barclays, Bank of America, consensus)
- Acknowledges strong operating performance and a solid balance sheet.
- Accepts there may be some upside, but believes much of the good news is already in the price given the 2025 rally and elevated sector multiples. ^[31]
The cautious camp (Wolf Report, earlier downgrades)
- Worries that Canadian bank stocks are priced for near‑perfection at a time when credit losses and slower economic growth could surprise to the downside.
- Sees better risk‑reward elsewhere, leading to downgrades to Hold or the decision to exit bank exposure altogether. ^[32]

What investors may want to watch next

For anyone following Bank of Montreal stock into 2026, the latest research suggests a few focal points:

Credit quality and provisions – Do provisions remain subdued, or do they start climbing again if consumer or commercial stress emerges? ^[33]
Capital markets sustainability – Can BMO’s capital markets business continue to post outsized growth, or was 2025 an unusually strong year? ^[34]
U.S. growth and integration – The newly unified U.S. banking segment is a key driver; progress on efficiency and cross‑border growth will be closely watched. ^[35]
Dividend and capital deployment – Further dividend increases or buybacks would reinforce the “shareholder‑friendly” narrative, but regulators and ratings agencies will also be watching capital ratios. ^[36]
Valuation relative to peers – If Canadian bank stocks correct or consolidate while earnings remain resilient, the more cautious voices could turn constructive again. ^[37]

Bank of Montreal’s latest quarter and dividend move give bulls plenty to work with, but the sharp 2025 rally and a cluster of “Hold” ratings show that not everyone is convinced there’s much easy upside left. Whether BMO turns out to be modestly undervalued or already priced for perfection will likely depend on how the bank executes in 2026—and whether the Canadian banking sector can keep threading the needle between resilient profits and growing macro risks.