To watch: BMO Bank, MTY and Uni-Select

Auto parts wholesale company Uni-Select was less than expected. (Photo: 123RF)

What do you do with BMO, MTY and Uni-Select Bank securities? Here are some recommendations from analysts that may move prices soon. Note: the author may have a completely different opinion than that expressed.

BMO Bank ($ 101.84, BMO): Profit exceeds expectations by 42% thanks to its US division

BMO Bank begins with banking results in a big way.

Some analysts also predictedAnd the Its US operations steal the spotlight, with a 67% jump in profits to $ 459 million ($ 1 million) in the first quarter.

This sharp increase south of the border resulted in better-than-expected revenue (up 7%), but lower operating expenses (down 7%) and reversing $ 25 million in loan loss provisions.

As for Canadian core banking, profits increased 5% to $ 737 million, thanks to a slight 1% increase in revenue and a 3% decrease in non-interest expenses.

Loans granted increased by 3% in Canada, while provisions decreased by $ 44 million compared to the previous quarter.

Generally, the bank has also set aside less reserves for potential loan losses. Provisions decreased from $ 432 million to $ 156 million between the fourth and first quarters. That’s much less than the $ 547 million Scott Chan expected from Canaccord Genuity.

All sections contributed to the performance, Canaccord Genuity’s Scott Chan notes: Earnings before taxes and provisions were up 16% overall, and a 24% increase in the US. Wealth management increased its profits by 18% while that of the money markets division increased by 34%.

The bank improved the interest margin, and the difference between interest paid on deposits and interest paid on loans, compared to the previous quarter. In the US, the increase was 17 percentage points, in Canada, 6 percentage points.

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The 1% decrease in total operating expenses gave the bank a 7.1% leverage while its efficiency ratio improved from 60.3 to 56.3% over the past year, the analyst identifies.

Bottom line, net income jumped 27% to $ 3.06 a share, which is 42% more than the consensus of $ 2.15 a share.

BMO Bank ended the first quarter with good capitalization: the regulatory capital ratio increased 50 percentage points to 12.4%, compared to the previous quarter.

The bank also achieved a return on equity of 15.8%, up 230 percentage points from the previous year. Scott Chan says this exceeds the bank’s medium-term target of 15%.

While waiting for the conference call, the analyst maintains a buy recommendation and target price at $ 106.50.

MTY (MTY, $ 49.86): The doubts have no place

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