BMO vs. BNS, CM, TD, NA, RY, BN, MFC, SLF, IFC, and GWO
Should you be buying Bank of Montreal stock or one of its competitors? The main competitors of Bank of Montreal include Bank of Nova Scotia (BNS), Canadian Imperial Bank of Commerce (CM), Toronto-Dominion Bank (TD), National Bank of Canada (NA), Royal Bank of Canada (RY), Brookfield (BN), Manulife Financial (MFC), Sun Life Financial (SLF), Intact Financial (IFC), and Great-West Lifeco (GWO). These companies are all part of the "financial services" sector.
Bank of Nova Scotia (TSE:BNS) and Bank of Montreal (TSE:BMO) are both large-cap financial services companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, earnings, risk, community ranking, dividends, media sentiment, valuation, analyst recommendations and profitability.
Bank of Nova Scotia pays an annual dividend of C$4.24 per share and has a dividend yield of 6.7%. Bank of Montreal pays an annual dividend of C$6.04 per share and has a dividend yield of 5.1%. Bank of Nova Scotia pays out 70.0% of its earnings in the form of a dividend. Bank of Montreal pays out 82.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Bank of Nova Scotia is clearly the better dividend stock, given its higher yield and lower payout ratio.
Bank of Montreal received 162 more outperform votes than Bank of Nova Scotia when rated by MarketBeat users. However, 54.78% of users gave Bank of Nova Scotia an outperform vote while only 52.66% of users gave Bank of Montreal an outperform vote.
51.0% of Bank of Nova Scotia shares are held by institutional investors. Comparatively, 54.9% of Bank of Montreal shares are held by institutional investors. 0.0% of Bank of Nova Scotia shares are held by insiders. Comparatively, 0.0% of Bank of Montreal shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Bank of Nova Scotia has higher earnings, but lower revenue than Bank of Montreal. Bank of Nova Scotia is trading at a lower price-to-earnings ratio than Bank of Montreal, indicating that it is currently the more affordable of the two stocks.
Bank of Nova Scotia presently has a consensus price target of C$67.74, indicating a potential upside of 6.66%. Bank of Montreal has a consensus price target of C$134.12, indicating a potential upside of 12.25%. Given Bank of Nova Scotia's stronger consensus rating and higher possible upside, analysts plainly believe Bank of Montreal is more favorable than Bank of Nova Scotia.
In the previous week, Bank of Nova Scotia had 9 more articles in the media than Bank of Montreal. MarketBeat recorded 23 mentions for Bank of Nova Scotia and 14 mentions for Bank of Montreal. Bank of Montreal's average media sentiment score of 0.48 beat Bank of Nova Scotia's score of 0.29 indicating that Bank of Nova Scotia is being referred to more favorably in the media.
Bank of Nova Scotia has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500. Comparatively, Bank of Montreal has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.
Bank of Nova Scotia has a net margin of 26.41% compared to Bank of Nova Scotia's net margin of 17.71%. Bank of Montreal's return on equity of 9.89% beat Bank of Nova Scotia's return on equity.
Summary
Bank of Montreal beats Bank of Nova Scotia on 10 of the 19 factors compared between the two stocks.
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This chart shows the number of new MarketBeat users adding BMO and its top 5 competitors to their watchlist. Each company is represented with a line over a 90 day period.
This chart shows the average media sentiment of TSE and its competitors over the past 90 days as caculated by MarketBeat. The averaged score is equivalent to the following: Very Negative Sentiment <= -1.5, Negative Sentiment > -1.5 and <= -0.5, Neutral Sentiment > -0.5 and < 0.5, Positive Sentiment >= 0.5 and < 1.5, and Very Positive Sentiment >= 1.5.
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