Value
6.2/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 6.7 |
| P/S | 8.0 |
| Fwd P/E | 8.1 |
| PEG | 5.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 14.6x
- ▸PEG: 1.53
BMO · Why this verdict
Why Bank Of Montreal (BMO) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score4.8/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Bank of Montreal has strong price momentum and healthy margins, but the stock at $171.13 is already above the $143.53 analyst target and business quality is below average, so upside looks limited.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Business quality is below average at 4.7/10, with a weak Piotroski F-Score of 3/9 and no identified competitive moat despite 26% margins. Quality breakdown | Piotroski F-Score improves above 5 and the quality score rises above 5.5 over ~12 months. | →Stable |
| CounterBank fundamentals scored on industrial-style metrics can understate true quality; margins of 26% are strong. | ||
The stock has run past the $143.53 analyst target, with upside of -16.1% meaning the price is above the target, so the analyst case offers no cushion. Upside pct | Analyst targets are revised up toward the $171 price, or the price consolidates back toward the target over the next 12 months. | →Stable |
| CounterBank targets often lag rallies, and strong momentum can keep the stock above consensus for extended periods. | ||
Momentum is strong at 7.6/10 with a golden cross, rising on-balance volume and the price above the 200-day average. Momentum breakdown | The price holds above its 200-day average and momentum stays above 5.5. | ↑Improving |
| CounterA volume surge of 3.1x on a selloff signals heavy distribution, and the stock is extended well above its target. | ||
Valuation is moderate at a 14.6x forward P/E and PEG of 1.53, but earnings growth scores 0.0/10, so the multiple is not backed by growth. Valuation breakdown | Earnings growth turns positive so that PEG falls below 1.2 while the forward P/E holds near 14.6x. | →Stable |
| CounterWith earnings growth at the bottom of its range, the multiple could compress rather than the earnings catching up. | ||
The setup carries a downside of 7.2% to the $165.03 stop, against a negative asymmetry ratio of -2.23. Stop loss | The price stays above the $165.03 stop level over the next 12 months, preserving the breakout. | →Stable |
| CounterA break below the stop would invalidate the breakout and, with price above target, the downside to the target is much larger than 7.2%. | ||
Business quality is below average at 4.7/10, with a weak Piotroski F-Score of 3/9 and no identified competitive moat despite 26% margins.
→StableQuality breakdown
- Expectation
- Piotroski F-Score improves above 5 and the quality score rises above 5.5 over ~12 months.
CounterBank fundamentals scored on industrial-style metrics can understate true quality; margins of 26% are strong.
The stock has run past the $143.53 analyst target, with upside of -16.1% meaning the price is above the target, so the analyst case offers no cushion.
→StableUpside pct
- Expectation
- Analyst targets are revised up toward the $171 price, or the price consolidates back toward the target over the next 12 months.
CounterBank targets often lag rallies, and strong momentum can keep the stock above consensus for extended periods.
Momentum is strong at 7.6/10 with a golden cross, rising on-balance volume and the price above the 200-day average.
↑ImprovingMomentum breakdown
- Expectation
- The price holds above its 200-day average and momentum stays above 5.5.
CounterA volume surge of 3.1x on a selloff signals heavy distribution, and the stock is extended well above its target.
Valuation is moderate at a 14.6x forward P/E and PEG of 1.53, but earnings growth scores 0.0/10, so the multiple is not backed by growth.
→StableValuation breakdown
- Expectation
- Earnings growth turns positive so that PEG falls below 1.2 while the forward P/E holds near 14.6x.
CounterWith earnings growth at the bottom of its range, the multiple could compress rather than the earnings catching up.
The setup carries a downside of 7.2% to the $165.03 stop, against a negative asymmetry ratio of -2.23.
→StableStop loss
- Expectation
- The price stays above the $165.03 stop level over the next 12 months, preserving the breakout.
CounterA break below the stop would invalidate the breakout and, with price above target, the downside to the target is much larger than 7.2%.
Per-dimension breakdown
Quality
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.5 |
| ROA | 0.4 |
| Gross margin | 0.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Moat | 5.4 |
| Piotroski F | 3.3 |
- ▸Strong margins: 26%
- ▸No competitive moat
- ▸Weak Piotroski F-Score: 3/9
Growth
2.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.5 |
| EPS growth | 0.0 |
Momentum
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.4 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 2.1 |
- ▸Overbought (RSI 72)
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 4.3 |
| erm sentiment | 5.0 |
Insider
5.0/10data confidence 50%Peer rank
4.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.3 |
| quality rank | 1.9 |
| growth rank | 7.5 |
Technical
3.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.1 |
| support resistance | 0.2 |
| 52w position | 9.1 |
| gap | 5.0 |
Risk (lower is worse)
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| days to cover | 2.4 |
| volatility | 7.9 |
| put call | 10.0 |
| implied vol | 7.9 |
| max pain risk | 3.0 |
| beta | 6.5 |
- ▸Above max pain $80
Catalyst
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 5.4 |
| dividend safety | 4.5 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:5.3>=4.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:28d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.8=NEGATIVE
Warning (1)
- MOMENTUM:5.3<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
-1.81
Upside
-19.1%
Downside
10.6%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeCatalyst-Driven — Earnings in 28d with 4/4 beat streak
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 5.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Risk (lower is worse) at 6.3) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.8=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.81 — supplementary context, not the trigger for this path.
The strongest dimensions are Risk (lower is worse) at 6.3, Value at 6.2, and Catalyst at 6.0; the weakest are Growth at 2.8, Technical at 3.6, and Peer rank at 4.2. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -1.81 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Price Above Analyst Target
Trip ifShare price falls more than 16% from $171.13 to below $143.53, reaching the analyst target.
- P2Strong Breakout Momentum
Trip ifMomentum score falls below 5.5 from current 7.6.
- P3Weak Quality No Moat
Trip ifQuality score falls below 4.0 from current 4.7.
- P4Moderate Valuation Weak Growth
Trip ifForward P/E exceeds 18x from current 14.6x without an earnings increase.
- P5Limited Downside Defined Risk
Trip ifShare price drops to $165.03 or lower, below the stop level.