BMO Price Forecast Based on Dividend Discount Model

A technique commonly used by dividend investors to value dividend-issuing stocks is the Dividend Discount Model (DDM), which seeks to determine a fair share price based on the dividend provided by the company relative to a number of other company-specific factors. In the case of BMO, the DDM model, as implemented by StockNews, implies a positive return of 42.74% relative to its current price. Digging deeper, the aspects of Bank Of Montreal's dividend discount model that we found most interesting were:

• Relative to all dividend yielding stocks in our set, Bank Of Montreal's dividend yield of 5.44% is in the top 19.34%.
• In comparison to other US listed dividend yielding stocks in the Financial Services sector, the expected return of 42.74%, based on the stock's current share price and target price based on a dividend discount model, is greater than 79.04% of the DDM-forecasted return of its its sector peers.
• Out of all stocks in our universe of US-listed dividend-issuing stocks, Bank Of Montreal bears a discount rate, according to our calculations, lower than 79.04% of them (lower discount rates are generally perceived as positive, and a sign of lower risk).
• Bank Of Montreal's dividend growth rate is higher than 27.87% of stocks in its sector (Financial Services).

BMO Dividends vs. Peers