Bank of Montreal (BMO.TO)

"Higher for longer" interest rates hard on business. Not expecting growth from Canadian banking sector. Would recommend buying at cheap price. Expecting company to turnaround eventually. Strong assets and brand name for the long term investor. 

She holds, but not as core holding. Had to increase loan loss provisions in US last quarter, and 2 consecutive quarters of that was not well received. Loan growth is slowing along with economy. Acquisition will work out long term. Doesn't see Canadian economy going into recession, so rate cuts should help. Yield is 5%.

His favourite. He's overweight BMO versus the other banks. Likes expansion in the US, well positioned for growth. Results a bit disappointing on integration side, but confident in management to realize synergies. Stock's come down way too much, good time to start picking away.

It is the only big bank she doesn't own. Canadian banks recently announced disappointing returns, especially BMO. It trades at a premium valuation to its peers, so there are premium expectations. Also its assets in the Mid-West are giving weak returns as well. She likes Royal and TD.

BMO is still reeling from its weak recent quarterly report. It is now 10.8X earnings, down 12.5% YTD. With some other banks below 10X earnings, we think it could go there too. This would imply about $111 or so. 
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It's been beaten up. Offers good growth with new acquisitions coming on. It's on sale now.

 Has recently disappointed. Might be a buying opportunity.  

Large exposure to commercial loan portfolio. Overall, a quality business that can weather economic storm. If interest rates rise will determine future of business. If interest rates fall - will be good for business. 2025/26 mortgage renewals will be interesting to watch. Would recommend holding shares in company. Would recommend investors "hold". 

Banks are a good long term investment but you don't have to own all the banks. Bank of Montreal has the largest exposure to commercial banking so it could be a recessionary risk. He wants more stability in a bank so he owns Royal, TD and National.

Current yield ~5% - good offer for investors. Valuation attractive for investors. Canadian banks generally a safe option. Good place for defensive investors. Not huge growth. 

If you're going to buy in the space, BMO and RY are the two to consider. Accretion from acquisitions is working for both. BMO is 2 points cheaper. Still, he'd rather go with insurance -- MFC first, IFC second.

They bought Bank of the West, synergistic for pooling resources and adding assets. BMO is the more commercial bank in Canada vs. peers. A great bank, but commercial banking is volatile when the economy is weak. He prefers other banks like RY and TD for their stability.

The question was on his preference for the two banks. Both have international operations with BMO focused more in the U.S. and BNS more in Latin America. He prefers BMO. Now is not the time to buy BNS but watch it over the next four quarters,

One of the best. Banks have nice dividends and decent valuations, but not a lot of growth. BMO has accretion from its Bank of the West deal. Great capital holders over time.

That said, he'd rather go with SLF or MFC right now. Insurance companies have outperformed Canadian banks for 3 years in a row.