Bank of Montreal (TSX:BMO)(NYSE:BMO), the fourth-largest bank in Canada, has watched its stock fall about 8% in 2015, far underperforming the TSX Composite Index’s return of over 2%, but I think it has bottomed and could be one of the market’s top performing stocks from this point forward. Let’s take a look at three of the primary reasons why this could happen and why you should be a long-term buyer today.

1. Its strong second-quarter earnings could support a rally today

Bank of Montreal released strong second-quarter earnings results on the morning of May 27, but its stock has responded by falling about 3% in the trading sessions since. Here’s a summary of 10 of the most notable statistics from the report compared with the year-ago period:

  1. Adjusted net income increased 4.5% to $1.15 billion
  2. Adjusted earnings per share increased 4.9% to $1.71
  3. Revenue, net of insurance claims, commissions, and changes in policy benefit liabilities increased 11.4% to $4.50 billion
  4. Non-interest income increased 4.7% to $2.41 billion
  5. Net interest income increased 2.4% to $2.11 billion
  6. Total assets increased 8.8% to $633.28 billion
  7. Total deposits increased 7.7% to $424.23 billion
  8. Net loans and acceptances increased 7.2% to $315.86 billion
  9. Total assets under management increased 81.8% to $387.67 billion
  10. Book value per share increased 12.4% to $51.65

2. Its stock trades at attractive forward valuations

At today’s levels Bank of Montreal’s stock trades at just 11.2 times fiscal 2015’s estimated earnings per share of $6.73 and only 10.6 times fiscal 2016’s estimated earnings per share of $7.10, both of which are inexpensive compared with the industry average price-to-earnings multiple of 13.4.

I think Bank of Montreal’s stock could consistently command a fair multiple of at least 13, which would place its shares upwards of $87 by the conclusion of fiscal 2015 and upwards of $92 by the conclusion of fiscal 2016, representing upside of more than 15% and 21%, respectively, from current levels.

3. It has a high dividend yield with a track record of increases

Bank of Montreal pays a quarterly dividend of $0.82 per share, or $3.28 per share annually, giving its stock a 4.3% yield at today’s levels. The company has also increased its dividend six times since 2012, showing that it is dedicated to maximizing shareholder value, and its consistent free cash flow generation could allow for another increase in the second half of this year. 

Is now the time to buy Bank of Montreal?

I think Bank of Montreal’s stock could outperform the overall market going forward. It has the support of strong second-quarter earnings growth, its stock trades at inexpensive forward valuations, and it has an extensive track record of increasing its dividend with a current yield of approximately 4.3%. All Foolish investors should take a closer look and strongly consider beginning to scale in to positions today.

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Fool contributor Joseph Solitro has no position in any stocks mentioned.