Click to view the earnings moves in BMO
BMO Surges on Strong Q3 Earnings — But Will the Rally Stick?
The Bank of Montreal (BMO) is in the spotlight today after reporting third quarter 2025 earnings that handily beat last year’s results. Shares moved up by 3.2% following the announcement, outperforming the ±4.5% move anticipated by the options market. But as the initial excitement fades, what can investors glean from BMO’s historical performance around earnings?
Breaking Down BMO’s Q3 Results and Catalysts
For the third quarter, BMO delivered reported net income of $2.33 billion (up 25% from last year), adjusted EPS of $3.23 (up 22% year-over-year), and a Common Equity Tier 1 (CET1) Ratio of 13.5%. CEO Darryl White highlighted the quarter as another strong one for earnings growth, with disciplined execution across the board and a focus on both Canadian and U.S. business strength. Notably, BMO is set to acquire Burgundy Asset Management, expanding its wealth management footprint, and has initiated a new normal course issuer bid to repurchase up to 30 million shares—both events likely contributing to market enthusiasm today.
For more detail on BMO's historical stock performance around earnings, you can explore the earnings history statistics here.
How Has BMO's Stock Typically Reacted to Earnings?
It’s easy to get swept up in today’s green numbers, but BMO’s historical stock moves around earnings paint a nuanced picture:
| Stock Performance | Earnings Move | Open Gap | Open to High | Open to Low | Open to Close |
|---|---|---|---|---|---|
| Average Return | -0.7% | -1.3% | +2.3% | -1.7% | +0.6% |
| % of Moves Up | 58.3% | 25.0% | 66.7% | ||
| % of Moves Down | 41.7% | 75.0% | 33.3% |
Over the last 12 quarters, the stock has, on average, dipped slightly (-0.7%) on earnings days. Interestingly, BMO tends to open lower after results, with a -1.3% open gap, but frequently rallies from there: the average move from open to high is a positive +2.3%, and the open-to-close drift is +0.6%, with two-thirds of sessions finishing higher by the close.
| Stock Performance | Earnings Move | Open Gap | Open to High | Open to Low | Open to Close |
|---|---|---|---|---|---|
| Absolute Average Return | 3.6% | 2.2% | 2.3% | 1.7% | 2.7% |
| Max Absolute Return | 9.5% | 4.5% | 10.0% | 6.5% | 9.4% |
| Min Absolute Return | 0.5% | 0.1% | 0.0% | 0.0% | 0.0% |
On an absolute basis, BMO can move on earnings, with a max move as high as 9.5% in either direction. But more often, the move is around 3-4% — a little below what options traders priced in this quarter.
What About Post-Earnings Momentum?
For traders eyeing the post-earnings drift, the odds tilt to mild short-term gains:
| Stock Performance | 1 Day After Earnings | 2 Days After Earnings | 3 Days After Earnings | 1 Week After Earnings | 2 Weeks After Earnings |
|---|---|---|---|---|---|
| Average Return | +0.5% | +0.6% | +0.6% | -0.6% | -0.8% |
| % of Moves Up | 63.6% | 63.6% | 81.8% | 45.5% | 45.5% |
| % of Moves Down | 36.4% | 36.4% | 18.2% | 54.5% | 54.5% |
BMO has closed higher three days after earnings 81.8% of the time over the past dozen quarters, averaging a gain of +0.6%. However, over the one- and two-week period post-earnings, performance skews slightly negative, perhaps reflecting profit-taking after initial enthusiasm fades.
Spotlight on Options Activity: What's the Big Bet?
Todays option volume spiked to 869 contracts—noticeably above normal. The most actively traded single-leg contract today was a long-dated call: the September 19, 2025 $120 strike. Here's a quick summary:
| Option Contract | 19-Sep-25 120 C |
|---|---|
| Volume | 229 |
| VWAP price | 0.99 |
| Open Interest | 2,291 |
| Yesterday's Closing Price | 0.53 |
This $120 call is just out-of-the-money and traded nearly half its open interest today. The surge in call activity hints that at least some traders are positioning for further upside in BMO over the next year—a potential bet on continued strength from U.S. operations or M&A synergies. Is this pure speculation, or does someone see another catalyst ahead?
The Takeaway: What to Watch from Here
BMO’s strong Q3 report justifies some optimism, and the stock’s move was in line with what the options market predicted. Yet, the bank’s history suggests caution—while the initial reaction to earnings is often muted or mixed, short-term upward drifts are common, with more uncertainty further out.
If you’re watching BMO for potential trades, it’s worth tracking both upcoming corporate actions (like the Burgundy Asset Management acquisition) and market sentiment. Want to dive deeper into the numbers? Check out the full historical earnings move statistics here.
Contact Information:
If you have feedback or concerns about the content, please feel free to reach out to us via email at support@marketchameleon.com.
About the Publisher - Marketchameleon.com:
Marketchameleon is a comprehensive financial research and analysis website specializing in stock and options markets. We leverage extensive data, models, and analytics to provide valuable insights into these markets. Our primary goal is to assist traders in identifying potential market developments and assessing potential risks and rewards.
NOTE: Stock and option trading involves risk that may not be suitable for all investors. Examples contained within this report are simulated and may have limitations. Average returns and occurrences are calculated from snapshots of market mid-point prices and were not actually executed, so they do not reflect actual trades, fees, or execution costs. This report is for informational purposes only, and is not intended to be a recommendation to buy or sell any security. Neither Market Chameleon nor any other party makes warranties regarding results from its usage. Past performance does not guarantee future results. Please consult a financial advisor before executing any trades. You can read more about option risks and characteristics at theocc.com.
The information is provided for informational purposes only and should not be construed as investment advice. All stock price information is provided and transmitted as received from independent third-party data sources. The Information should only be used as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments and trading strategies. The Company does not guarantee the accuracy, completeness or timeliness of the Information.