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ZYBERNO

Stock Report

Updated Aug 25, 2026

BANK OF MONTREAL /CAN/ (CARU)

Financial Services • NYSE

$23.26

Professional Investment Analysis

ZYBERNO SCORE →

Is it a great business? Is it getting better?

43.0/100

WEAK BUSINESS

BANK OF MONTREAL /CAN/ (CARU) scores 43/100 — weak fundamentals with mixed indicators requiring careful analysis before acting.

📊 How is the Zyberno Score calculated? +

The Zyberno Score answers one question: "Is this a quality business worth owning?" It's a 0-100 investment grade that evaluates business fundamentals across four critical dimensions, based on principles from Warren Buffett, Benjamin Graham, Peter Lynch, and Charlie Munger.

The 4 Core Categories (25 points each):

1. PROFITABILITY (25 pts)

Metrics: ROE, ROIC, Net Margin, Operating Margin
Thresholds: ROE >20% excellent • ROIC >20% excellent • Net Margin >20% excellent • Operating Margin >25% excellent

2. FINANCIAL STRENGTH (25 pts)

Metrics: Debt-to-Equity, Current Ratio, Interest Coverage, Altman Z-Score
Thresholds: D/E <0.3 excellent • Current Ratio >2.5 excellent • Interest Coverage >10x excellent • Altman Z >3.0 safe

3. CASH FLOW QUALITY (25 pts)

Metrics: Free Cash Flow, OCF vs Net Income, FCF Margin
Thresholds: Positive & growing FCF excellent • OCF/NI >1.2x excellent (cash earnings exceed accounting)

4. GROWTH & CONSISTENCY (25 pts)

Metrics: Revenue Growth, Net Income Growth, FCF Growth, Piotroski F-Score
Thresholds: Growth via log-linear regression • Piotroski 8-9 excellent, 6-7 good

Score Interpretation:

75-100

GREAT BUSINESS

65-74

GOOD BUSINESS

50-64

AVERAGE BUSINESS

30-49

WEAK BUSINESS

0-29

POOR BUSINESS

→ View full CARU quality analysis & detailed breakdown

VALUATION SIGNAL

⚠

Business Model Limitation

BANK OF MONTREAL /CAN/ operates in the Commercial Banks, NEC industry. Owner Earnings-based DCF analysis — the foundation of both the Margin of Safety and the Brina Gap — is not well-suited to companies whose business model is structurally built around leverage: banks, insurers, mortgage companies, and REITs. These businesses are typically valued using sector-specific metrics such as Price-to-Book, Price-to-FFO, or Net Asset Value. Treat these signals as directional only.

MARGIN OF SAFETY

Is this stock cheap or expensive relative to what the business has historically generated for owners?

+80.8%

Undervalued

Growth gap unavailable — insufficient data for reverse DCF calculation.

🎯 Expected Annual Return →

11.2%

5-year annualised assuming price converges to intrinsic value

💰 How is Margin of Safety calculated? +

Margin of Safety measures how much discount or premium you're paying relative to a stock's intrinsic value. It's Benjamin Graham's core principle: the larger the margin, the lower your downside risk.

Formula: (Intrinsic Value − Current Price) ÷ Intrinsic Value × 100%

How We Calculate Intrinsic Value (DCF Method):

Step 1: Calculate current Owner Earnings (OCF − Maintenance CapEx)

Step 2: Calculate company-specific growth rate using log-linear regression on 16 quarters of Owner Earnings

Step 3: Project 10 years forward using the calculated growth rate

Step 4: Discount each year's cash flow to present value using 10% discount rate

Step 5: Calculate terminal value using 3% perpetual growth rate

Step 6: Sum all discounted cash flows = Intrinsic Value

What The Percentages Mean:

+50% or more

EXCELLENT — Very undervalued

+25% to +50%

GOOD — Attractive discount

0% to +25%

FAIR — Reasonable value

0% to -25%

CAUTION — Slight premium

-25% or worse

POOR — Overvalued

"Price is what you pay, value is what you get." — Warren Buffett

→ View full CARU valuation analysis · → View full CARU Brina Gap analysis

📈 How is Brina Gap calculated? +

Brina Gap measures the difference between the growth a business can fundamentally sustain and the growth the market is already pricing in.

Formula: Fundamental Growth Rate − Market-Implied Growth Rate

The Two Components:

Fundamental Growth Rate = ROIC × Reinvestment Rate

What the business can sustainably grow at based on how much it reinvests and what return it earns on that capital. Grounded in historical financials.

Market-Implied Growth Rate = Reverse DCF

The growth rate the current Enterprise Value implicitly assumes. Calculated by back-solving a 10-year DCF model (10% WACC, 3% terminal growth) until the present value of projected cash flows equals EV.

What The Gap Means:

Gap > +5% Market Underestimates — potential upside

+2% to +5% Slight Underestimate

-2% to +2% Fairly Priced — market consensus matches fundamentals

-5% to -2% Slight Overestimate

Gap < -5% Market Overestimates — price embeds optimism fundamentals don't support

A positive gap (market underestimates) combined with a positive Margin of Safety is the strongest combined signal — the business is both cheap historically and forward economics are stronger than the price suggests.

Critical Financial Health Indicators

Return on Equity (Profitability):AVERAGE (10.6%)

Debt-to-Equity (Solvency Risk):EXCELLENT (0.00x)

Operating Margin (Operational Efficiency):CRITICAL (0.0%)

Return on Capital (Capital Efficiency):CRITICAL (0.0%)

📊 Valuation Trilogy

Three interconnected metrics for complete valuation analysis

Click any metric for full methodology and detailed analysis

Zyberno's Verdict

BANK OF MONTREAL /CAN/ (CARU) stock report — Zyberno Score 43/100 (WEAK BUSINESS), Margin of Safety +80.8%, 11% expected annual return. Full financial analysis on Zyberno.

According to Zyberno's DCF model, BANK OF MONTREAL /CAN/ (CARU) trades at $23.26 against an estimated intrinsic value per share of $120.88 — a +80.8% Margin of Safety based on Owner Earnings of $19.21B TTM, projected at -38.7% growth for 10 years with a 2.5% terminal growth rate. Zyberno's model translates this into a 5-year expected return of 11.2% annually.

Over the trailing twelve months, CARU generated $19.21B in Owner Earnings. Capital was deployed as follows: $3.61B paid as dividends, $637.14M invested in capital expenditures. Owner Earnings have declined at 38.7% annually over the trailing five years using log-linear regression.

DIVISION I: EXECUTIVE SUMMARY

A. Market Valuation

Market Price & Capitalization (2)

Current Price:23.26

Market Cap:$16.49B

Valuation Multiples (4)

P/E Ratio:

1.94x

📊 Click to view full CARU P/E analysis →

P/B Ratio:0.27x

P/S Ratio:0.63x

Peg Ratio:0.15x

Enterprise Metrics (2)

Enterprise Value:-$31.48B

Pfcf Ratio:0.86x

Price Action & Momentum (3)

12-1 Momentum:

-25.1% (29th pctile)

📈 Click to view full CARU Momentum analysis →

Momentum Percentile:29 / 100

% of 52-Week High:61.8%

B. Profitability Assessment

Return Metrics (2)

ROE:

10.6%

📊 Click to view full CARU ROE analysis →

ROA:0.6%

Margin Analysis (2)

Net Margin Ttm:24.6%

Ebitda Margin:0.0%

TTM Performance (1)

Net Margin Ttm:24.6%

Yield Metrics (3)

Earnings Yield:$51.60

Owner Earnings Yield:$116.54

Dividend Yield:21.9%

C. Log-Linear Regression Growth Trends

Earnings Surprise (SUE) (3)

Earnings Surprise (SUE):

+0.15

📊 Click to view full CARU Earnings Surprise analysis →

EPS Surprise vs Expected:11.6%

Latest Earnings Filed:2026-02-25

Revenue Growth (Linear) (1)

Revenue Growth Rate (Linear):6.0%

Earnings Growth (Linear) (1)

Net Income Growth Rate (Linear):5.4%

Cash Flow Growth (Linear) (2)

Free Cash Flow Growth Rate (Linear):-38.7%

Operating Cash Flow Growth Rate (Linear):-35.1%

D. Financial Stability

Liquidity Ratios (3)

Current Ratio:999.00x

Quick Ratio:999.00x

Cash Ratio:999.00x

Leverage Analysis (3)

Debt To Equity Ttm:0.00x

Debt-to-Equity Ratio:0.00x

Debt To Ebitda:-999.00x

Coverage Ratios (2)

Interest Coverage Ratio:0.00x

Times Interest Earned:0.00

Capital Structure (4)

Working Capital:0.00

Cash And Cash Equivalents:47,965,859,176.00

Long Term Debt:$0.00

Net Debt:-$47.97B

DIVISION II: FINANCIAL STATEMENTS ANALYSIS

A. Income Statement Analysis

Revenue Components (2)

Revenue TTM: $26.22B

Linear Growth: 6.0%

📊 Click to view full CARU Revenue analysis & methodology →

Cost Of Revenue Ttm:$0.00

Profitability Breakdown (2)

$0.00$0.00

Bottom Line Performance (3)

Net income TTM: $6.46B

Linear Growth: 5.4%

📊 Click to view full CARU Net Income analysis & methodology →

Income Before Tax:$0.00

Ebitda Ttm:0.00

Operating Expenses (5)

Operating Expenses:0.00

R And D Expense:0.00

Sga Expense:0.00

Income Tax Expense:$2.12B

Interest Expense:28,721,282,740.00

Expense Ratios (3)

R And D To Revenue Percentage:0.0%

Sga To Revenue Percentage:0.0%

Ebitda Margin:0.0%

B. Balance Sheet Analysis

Asset Composition (5)

Total Assets:$1.04T

Current Assets:$0.00

Ppe Net:4,371,016,880.00

Goodwill:11,830,933,148.00

Intangible Assets:$3.57B

Liability Structure (4)

Total Liabilities:976,987,054,852.00

Current Liabilities:0.00

Long Term Debt:$0.00

Short Term Debt:$0.00

Equity & Capital (3)

Equity:$61.05B

Retained Earnings:$0.00

Common Stock:0.00

Working Capital Items (3)

Accounts Receivable:0.00

Inventory:0.00

Accounts Payable:0.00

Special Items (2)

Contract Liabilities:0.00

Stock Based Compensation:0.00

C. Cash Flow Analysis

Operating Activities (2)

Operating cash flow TTM: $5.10B

Linear Growth: -35.1%

Free cash flow TTM: $4.47B

Linear Growth: -38.7%

📊 Click to view full CARU Free Cash Flow analysis & methodology →

Investment Activities (2)

Investing Cash Flow:$212.14M

Capital Expenditures Ttm:637,143,340.00

Financing Activities (3)

Financing Cash Flow:-$446.36M

Dividends Paid Ttm:3,606,444,872.00

Stock Repurchase:0.00

Capital Transactions (3)

Common Stock Issuance:0.00

Long Term Debt Issuance:$0.00

Long Term Debt Repayments:$0.00

DIVISION III: OPERATIONAL METRICS

A. Per Share Analysis

Earnings Per Share (3)

EPS (Basic TTM):12.02

Eps diluted TTM: $12.00

Linear Growth: 2.6%

📊 Click to view full CARU EPS analysis & methodology →

Earnings Per Share Ttm:$9.11

Revenue & Cash Per Share (3)

Sales Per Share Ttm:36.99

Operating Cash Flow Per Share:$10.28

Fcf Per Share Ttm:27.10

Book Value & Capital (2)

Book Value Per Share:$86.11

Cash Per Share:67.66

Dividend Policy (1)

Dividend Payout Ratio:55.43x

B. Operational Efficiency

Asset Utilization (2)

Asset Turnover Ttm:0.03x

Working Capital Turnover Ttm:-999.00x

Receivables Management (2)

Receivables Turnover Ttm:-999.00x

Days Sales Outstanding Ttm:-999.00

Inventory Management (2)

Inventory Turnover Ttm:-999.00x

Days Inventory Outstanding Ttm:-999.00

Payables & Cash Cycle (2)

Days Payable Outstanding:-999.00

Cash Conversion Cycle:-999.00

C. Quality & Risk Metrics

Financial Quality Scores (2)

Financial Strength Score:60.00

Quality Score:90.00

Market Metrics (2)

Beta:0.00x

Volatility Category:unknown

DIVISION IV: INVESTMENT ANALYSIS

A. Value Investment Framework

Owner Earnings Analysis (3)

Owner earnings TTM: $19.21B

Linear Growth: -38.7%

📊 Click to view full CARU Owner Earnings analysis & methodology →

Owner Earnings Per Share:$27.10

Owner Earnings Yield:$116.54

Growth Assessment (1)

Owner Earnings Growth Rate:-$38.65

Intrinsic Value Models (1)

Intrinsic Value:

$85.69B

📊 Click to view full CARU DCF valuation →

Margin of Safety (1)

Margin Of Safety:

80.8%

📊 Click to view full CARU valuation analysis →

Return Scenarios (1)

Theoretical 5-Year Return:

11.2%

📊 Click to view full CARU expected return analysis →

Investment Assessment (1)

Buffett Assessment:Excellent margin of safety

B. Log-Linear Regression Growth Analysis

Growth Rates (Log-Linear Regression) (2)

Revenue Growth Rate (Linear):6.0%

Net Income Growth Rate (Linear):5.4%

Cash Flow Growth Rates (2)

Free Cash Flow Growth Rate (Linear):-38.7%

Operating Cash Flow Growth Rate (Linear):-35.1%

Other Growth Rates (1)

Owner Earnings Growth Rate:-$38.65

C. Company Profile & Context

Corporate Information (6)

Symbol:CARU

Company Name:BANK OF MONTREAL /CAN/

Sector:Financial Services

Industry:Commercial Banks, NEC

Exchange:NYSE

Country:Canada

Market Classification (3)

Market Cap Category:N/A

Price Category:medium

Volume Category:N/A

Share Structure (3)

Shares Outstanding:708.91M

Shares Outstanding Basic:0

Shares Outstanding Diluted:0

Data Processing Info (3)

Processing Version:v3.0

Last Updated:2026-08-25 05:11:44 UTC

Data Timestamp:2026-08-25T05:11:44.888716