RBC Capital Markets upgraded Bank of Montreal (NYSE:BMO) and Canadian Imperial Bank of Commerce (NYSE:CM) to Outperform from Sector Perform in a recent note, as analyst Darko Mihelic sees a "transitional year" for Canadian lenders in 2025.

Bank of Montreal closed C$5.99 below its 52-week high of C$147.54, which the company achieved on December 6th.

Mihelic hiked his price target on Toronto-listed BMO shares from $133 to $161, while upgrading his rating to “Outperform” from “Sector perform.” The stock closed 1.75 per cent higher at $141.55 per share on Wednesday, outpacing the BMO Equal Weight Banks Index ETF ( ZEB.TO ), a basket of Canada’s biggest lenders.

Shares of Bank of Montreal BMO inched 0.85% higher to C$139.12 Tuesday, in what proved to be an otherwise all-around down trading session for the Canadian market, with the S&P/TSX Composite Index GSPTSE falling 0.28% to 24,929.89.