Should You Buy Bank of Montreal After Earnings?

Bank of Montreal (TSX:BMO)(NYSE:BMO) is the fourth-largest of the Big Six Canadian bank stocks.
Canada’s big banks have released their third quarter 2022 results at the end of August. BMO was the last
of the top financial institutions to make the reveal. Today, I want to discuss whether it is worth
snatching up BMO after its earnings release. Let’s dive in.

This bank unveiled its third quarter fiscal 2022 earnings on August 30. In Q3 2022, the bank delivered
adjusted net income of $2.13 billion or $3.09 per share – down from $2.29 billion or $3.44 per share in
the previous year. Like its peers, BMO was weighed down as its provisions set aside for credit losses
increased to $136 million compared to $70 million in the third quarter of 2021.

That said, adjusted net income in the year-to-date period reached $6.90 billion or $10.20 per share in
the year-to-date period. This was up from adjusted net earnings of $6.42 billion or $9.63 in the first nine
months of fiscal 2021.

In Q3 2022, BMO’s Canadian Personal and Commercial banking segment delivered adjusted net income
growth of 17% to $965 million. Meanwhile, United States P&C banking reported adjusted net income of
$569 million – up 2% from the previous year. However, BMO’s Wealth Management and Capital
Markets segments both posted an adjusted net income dip in the year-over-year period.

BMO stock has dropped 4.4% over the past week. The stock is down 11% in the year-to-date period.
Shares of this bank stock currently possess a very favourable price-to-earnings ratio of 6.8. It offers a
quarterly dividend of $1.39 per common share, which represents a solid 4.4% yield. BMO will face major
headwinds over the next year, but I’m looking to stack this bank stock after its post-earnings dip.