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BMO vs RY
Which Stock Would AI Choose? Bank of Montreal (BMO) vs. Royal Bank of Canada (RY) Stock Comparison
Key Takeaways
- Both BMO and RY are Canadian financial institutions with significant United States operations, making them natural peers in a head-to-head stock comparison.
- RY reported a higher adjusted return on equity (ROE, a measure of profitability versus shareholder capital) of roughly 16.7% for fiscal 2025, compared with about 11.3% for BMO.
- BMO has shown faster recovery momentum in its U.S. banking segment, which benefited from lower provisions for credit losses in recent quarters.
- RY is the larger franchise by market capitalization and delivered stronger broad-based earnings growth across capital markets and wealth management.
- Relative performance has favored RY in recent market activity, though both stocks posted substantial year-to-date gains amid improving credit conditions.
Introduction
Bank of Montreal and Royal Bank of Canada are two of the largest and most established financial institutions in North America, and they frequently appear side by side in investors' watchlists. Both operate diversified franchises spanning personal and commercial banking, wealth management, capital markets, and U.S. regional banking, yet they differ in scale, profitability, and growth trajectory. This stock comparison is relevant to income-oriented investors, value-focused fund managers, and traders who monitor Canadian bank equities for relative performance and market positioning. Understanding how these two names diverge on credit quality, capital efficiency, and earnings momentum can help market participants evaluate which profile aligns more closely with their own objectives in the current environment.
BMO Overview and Recent Performance
Bank of Montreal, commonly known as BMO, is a diversified North American financial services company with a long-standing Canadian retail franchise and a substantial U.S. presence built in part through its acquisition of Bank of the West. In recent quarters, BMO has delivered improving results, with fiscal 2025 adjusted earnings per share rising meaningfully year over year and return on equity climbing to roughly 11.3%, an improvement of about 150 basis points (1.5 percentage points) from the prior year. Its Common Equity Tier 1 (CET1) ratio, a key measure of a bank's capital strength, stood at about 13.3%. Growth was particularly notable in wealth management and capital markets, where adjusted earnings rose sharply, while the U.S. banking segment benefited from a significant decline in provisions for credit losses as the credit cycle improved. Management has continued to emphasize a digital-first, artificial-intelligence-enabled operating strategy while balancing cost discipline against softer near-term loan growth expectations.
RY Overview and Recent Performance
Royal Bank of Canada, widely referred to as RBC, is Canada's largest bank by market capitalization and one of the most diversified financial franchises in the country, with operations across personal and commercial banking, wealth management, insurance, and capital markets, as well as U.S. operations through City National. In its most recent fiscal year, RY posted strong results, with adjusted earnings per share up roughly 25% year over year in the final quarter and an adjusted return on equity of about 16.7%. The bank also raised its medium-term return on equity target to 17%-plus, signaling management confidence in sustained profitability. Net interest income and fee income both grew solidly, supported by strong capital markets and wealth management activity. The bank increased its quarterly dividend and maintained a robust CET1 ratio near the upper end of its target range, reflecting a stable capital position and disciplined balance-sheet management.
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Head-to-Head Comparison
While both banks share a common Canadian home market and U.S. expansion ambitions, their profiles diverge in meaningful ways. RY operates a larger, more diversified earnings base and currently generates a higher return on equity, reflecting stronger profitability across its wealth management and capital markets divisions. Its scale and fee-driven revenue mix tend to produce more consistent, broad-based earnings growth. By contrast, BMO carries greater relative exposure to U.S. commercial banking through its Bank of the West integration, which has weighed on efficiency but also positions the bank to benefit from an improving U.S. credit backdrop. On risk factors, both remain sensitive to Canadian consumer credit trends, unemployment, and trade-related economic uncertainty, though BMO has historically shown somewhat higher sensitivity to U.S. credit cycles. From a market sentiment standpoint, RY has generally commanded a premium valuation, consistent with its larger franchise and higher returns, while BMO has been viewed as more of a turnaround story with greater upside tied to U.S. profitability improvements.
Tickeron AI Verdict
Based on observable factors such as trend consistency, profitability, capital efficiency, and the breadth of earnings momentum, Tickeron's AI would likely favor RY at present. The bank's higher return on equity, stable capital position, and diversified, fee-rich revenue mix suggest a more consistent fundamental profile, while its relative performance has remained resilient in recent market activity. BMO presents a plausible catalyst-rich turnaround given its improving U.S. credit trends, but its lower current returns and greater sensitivity to the U.S. commercial banking cycle introduce more variability. The AI's assessment would therefore lean toward RY on stability and positioning, while acknowledging that BMO retains meaningful re-rating potential if its U.S. segment continues to recover.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is BMO is a StrongBuy and RY is a StrongBuy.
BMO's MACD Histogram crosses above signal line
The Moving Average Convergence Divergence (MACD) for BMO turned positive on October 15, 2026. Looking at past instances where BMO's MACD turned positive, the stock continued to rise in 28 of 46 cases over the following month. The odds of a continued upward trend are 61%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 16, 2026. You may want to consider a long position or call options on BMO as a result. In 36 of 65 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 55%.
BMO moved above its 50-day moving average on October 27, 2026 date and that indicates a change from a downward trend to an upward trend.
Following a +2.18% 3-day Advance, the price is estimated to grow further. Considering data from situations where BMO advanced for three days, in 206 of 384 cases, the price rose further within the following month. The odds of a continued upward trend are 54%.
The Aroon Indicator entered an Uptrend today. In 169 of 327 cases where BMO Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 52%.
Bearish Trend Analysis
The RSI Oscillator demonstrated that the stock has entered the overbought zone. This may point to a price pull-back soon.
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 9 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where BMO declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 56%.
BMO broke above its upper Bollinger Band on October 29, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 3 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 28 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 21, placing this stock worse than average.
The Tickeron Price Growth Rating for this company is 45 (best 1 - 100 worst), indicating steady price growth. BMO’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron PE Growth Rating for this company is 55 (best 1 - 100 worst), pointing to average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 68 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.439) is normal, around the industry mean (1.520). P/E Ratio (14.288) is within average values for comparable stocks, (11.818). Projected Growth (PEG Ratio) (1.518) is also within normal values, averaging (2.139). Dividend Yield (0.028) settles around the average of (0.034) among similar stocks. P/S Ratio (4.411) is also within normal values, averaging (3.867).
RY's MACD Histogram just turned positive
The Moving Average Convergence Divergence (MACD) for RY turned positive on October 15, 2026. Looking at past instances where RY's MACD turned positive, the stock continued to rise in 28 of 46 cases over the following month. The odds of a continued upward trend are 61%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 15, 2026. You may want to consider a long position or call options on RY as a result. In 33 of 75 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 44%.
RY moved above its 50-day moving average on October 26, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for RY crossed bullishly above the 50-day moving average on October 29, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 7 of 13 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 54%.
Following a +1.48% 3-day Advance, the price is estimated to grow further. Considering data from situations where RY advanced for three days, in 167 of 348 cases, the price rose further within the following month. The odds of a continued upward trend are 48%.
Bearish Trend Analysis
The RSI Indicator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 9 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where RY declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 54%.
RY broke above its upper Bollinger Band on October 21, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for RY entered a downward trend on October 19, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 3 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 11 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 21, placing this stock better than average.
The Tickeron Price Growth Rating for this company is 44 (best 1 - 100 worst), indicating steady price growth. RY’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron PE Growth Rating for this company is 66 (best 1 - 100 worst), pointing to average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 89 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.130) is normal, around the industry mean (1.520). P/E Ratio (12.958) is within average values for comparable stocks, (11.818). Projected Growth (PEG Ratio) (2.257) is also within normal values, averaging (2.139). Dividend Yield (0.024) settles around the average of (0.034) among similar stocks. RY's P/S Ratio (5.537) is slightly higher than the industry average of (3.867).
BMO | RY | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 22 | 35 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 68 Overvalued | 89 Overvalued | |
PROFIT vs RISK RATING 1..100 | 28 | 11 | |
SMR RATING 1..100 | 3 | 3 | |
PRICE GROWTH RATING 1..100 | 45 | 44 | |
P/E GROWTH RATING 1..100 | 55 | 66 | |
SEASONALITY SCORE 1..100 | 50 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
BMO's Valuation (68) in the Major Banks industry is in the same range as RY (89). This means that BMO’s stock grew similarly to RY’s over the last 12 months.
RY's Profit vs Risk Rating (11) in the Major Banks industry is in the same range as BMO (28). This means that RY’s stock grew similarly to BMO’s over the last 12 months.
RY's SMR Rating (3) in the Major Banks industry is in the same range as BMO (3). This means that RY’s stock grew similarly to BMO’s over the last 12 months.
RY's Price Growth Rating (44) in the Major Banks industry is in the same range as BMO (45). This means that RY’s stock grew similarly to BMO’s over the last 12 months.
BMO's P/E Growth Rating (55) in the Major Banks industry is in the same range as RY (66). This means that BMO’s stock grew similarly to RY’s over the last 12 months.
| BMO | RY | |
|---|---|---|
| RSI ODDS (%) | 2 days ago 50% | 2 days ago 37% |
| Stochastic ODDS (%) | 2 days ago 52% | 2 days ago 43% |
| Momentum ODDS (%) | 2 days ago 55% | 2 days ago 44% |
| MACD ODDS (%) | 2 days ago 61% | 2 days ago 61% |
| TrendWeek ODDS (%) | 2 days ago 56% | 2 days ago 46% |
| TrendMonth ODDS (%) | 2 days ago 53% | 2 days ago 44% |
| Advances ODDS (%) | 2 days ago 54% | 2 days ago 48% |
| Declines ODDS (%) | 8 days ago 56% | 23 days ago 54% |
| BollingerBands ODDS (%) | 2 days ago 49% | 2 days ago 29% |
| Aroon ODDS (%) | 2 days ago 52% | 2 days ago 39% |
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is overvalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
BMO’s FA Score shows that 2 FA rating(s) are green while RY’s FA Score has 2 green FA rating(s).
- BMO’s FA Score: 2 green, 3 red.
- RY’s FA Score: 2 green, 3 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
BMO’s TA Score shows that 5 TA indicator(s) are bullish while RY’s TA Score has 5 bullish TA indicator(s).
- BMO’s TA Score: 5 bullish, 4 bearish.
- RY’s TA Score: 5 bullish, 5 bearish.
Price Growth
BMO (@Major Banks) experienced а +3.19% price change this week, while RY (@Major Banks) price change was +2.61% for the same time period.
The average weekly price growth across all stocks in the @Major Banks industry was -0.19%. For the same industry, the average monthly price growth was -2.80%, and the average quarterly price growth was +7.52%.
Reported Earning Dates
BMO is expected to report earnings on Dec 03, 2026.
RY is expected to report earnings on Dec 02, 2026.
Industries' Descriptions
@Major Banks (-0.19% weekly)Major banks are among the biggest companies in the world, often times with global reach and market capitalizations in the multi-billions. Large banks often have multiple arms spanning different disciplines, from deposits, to investment banking, to wealth management and insurance. The biggest banks often have key competitive advantages over smaller players in the industry in terms of brand recognition, cost of capital, and efficiency. Think J.P. Morgan, Bank of America, Wells Fargo, and Citigroup.
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BMO and
Correlation & Price change
A.I.dvisor indicates that over the last year, BMO has been closely correlated with RY. These tickers have moved in lockstep 82% of the time. This A.I.-generated data suggests there is a high statistical probability that if BMO jumps, then RY could also see price increases.
RY and
Correlation & Price change
A.I.dvisor indicates that over the last year, RY has been closely correlated with TD. These tickers have moved in lockstep 85% of the time. This A.I.-generated data suggests there is a high statistical probability that if RY jumps, then TD could also see price increases.