China Merchants Bank (CIHKY) AI Stock Analysis

• Market Cap: $142.93B
• Dividend Yield: 4.24%
• Average Volume (3M): 2.29K
• Price to Earnings (P/E): 7.5
• Beta (1Y): 0.35
• Revenue Growth: -4.34%
• EPS Growth: 2.00%
• Country: US
• Employees: 117,201
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 1.08
• Shares Outstanding: 918,180,240
• 10 Day Avg. Volume: 1,781
• 30 Day Avg. Volume: 2,292
• PEG Ratio: 12.22
• Price to Book (P/B): 0.79
• Price to Sales (P/S): 1.94
• P/FCF Ratio: 2.34
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 0.36
• Enterprise Value/Gross Profit: 0.69
• Enterprise Value/Ebitda: 0.97
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 60 Neutral
• Price Target: $34.00 ▲(5.13% Upside)

The score is driven mainly by a healthy but less predictable financial profile (solid profitability/ROE but weakening TTM revenue and more volatile leverage/cash flow) and weak near-term technical momentum (negative MACD, sub-50 RSI, below short-term averages). These are partly offset by attractive valuation (low P/E and strong dividend yield) and an earnings update showing stable profit/asset quality with growth in wealth management, though NIM pressure remains a notable headwind.

Positive Factors

Consistent Profitability / ROE

Return on equity in the low-to-mid teens demonstrates durable earnings power and disciplined capital deployment. Sustained ROE supports shareholder returns, internal capital for growth and cushions cyclical shocks, underpinning long-term franchise value.

Wealth Management Growth

Rapid expansion of retail AUM and rising fee income diversifies revenue away from interest margins. Fee-based wealth flows are stickier, enhance cross-sell, and provide recurring non‑interest income that stabilizes profits through rate cycles and weak loan demand.

Low NPLs and High Coverage

Very low non-performing loans and a high coverage ratio provide strong loss-absorption capacity. This supports lending expansion and capital preservation in downturns, reducing the chance of abrupt credit shocks and protecting long-term solvency.

Negative Factors

Top-line Weakness

A material TTM revenue decline undermines growth visibility and increases reliance on cost control to preserve profits. Persistent top-line weakness constrains reinvestment, limits scalability of fee businesses, and raises risk to medium-term earnings sustainability.

NIM Pressure and Weak Retail Demand

Compression in net interest margin from weak retail loan demand reduces the core earnings engine for a commercial bank. Declines in payment and card income further erode stable fee streams, making earnings more sensitive to rate cycles and fee growth execution.

Volatile Leverage and Cash Conversion

Swings in leverage and uneven operating cash conversion increase balance-sheet and funding risk. Volatility can force tighter capital management, limit lending flexibility, and heighten sensitivity to macro stress, weakening strategic optionality over the medium term.

China Merchants Bank Business Overview & Revenue Model

Company Description

China Merchants Bank Co., Ltd., together with its subsidiaries, provides various banking products and services. It operates through Wholesale Finance Business, Retail Finance Business, and Other Business segments. The company offers current, demand, time, call, savings, notice, and renminbi accounts. Its loan products include personal commercial real estate, consumption, housing, and car loans; loans to finance for studying abroad; micro-business loans; mortgage loans for equipment; joint guarantee, special guarantee, and housing mortgage loan; bank acceptance, discount, liquid capital, and fixed asset loans; and loans for vessels. The company also offers credit cards; insurance products; open-ended funds; discount and guarantees for commercial bills, redemption of commercial bills, and guaranteed discount for commercial acceptance bills; and financial consultation, debt financing underwriting, merger and acquisition financing, and equity financing and enterprise listing services. In addition, it provides forfeiting and risk participation, escrow, cross-border RMB clearing, and interbank services; and risk and financial management, cross-border RMB and oversea financing, international factoring and settlement, and trade finance services. Further, the company offers financial leasing and guarantee, investment and wealth management, forex option and gold trading, forex express trading, international, offshore and private banking, custody, pension, and electronic banking services. As of December 31, 2021, it operated 143 branches; 1,770 sub-branches; one branch-level operation center; 2,812 self-service centers; 6,592 self-service machines; one representative office; 14,746 visual counters in Mainland China. The company also operates in Hong Kong, New York, London, Singapore, Luxembourg, Sydney, and Taipei. China Merchants Bank Co., Ltd. was founded in 1987 and is headquartered in Shenzhen, China.

How the Company Makes Money

China Merchants Bank primarily generates revenue through various banking services, including interest income from loans and advances to customers, which constitutes a significant portion of its earnings. The bank earns interest by lending money to individuals and businesses at higher rates than the interest it pays on deposits. Additionally, it generates fee-based income through services such as transaction fees, asset management fees, and wealth management services. Investment banking activities, including underwriting and advisory services, also contribute to its revenue streams. The bank has established partnerships with various financial institutions and fintech companies, enhancing its service offerings and expanding its customer base. Furthermore, China Merchants Bank benefits from its extensive branch network and digital banking platforms, which enable it to reach a broader audience and streamline operations.

China Merchants Bank Financial Statement Overview

Summary

Underlying profitability and ROE are solid, and free cash flow has generally tracked earnings. Offsetting these strengths are a sharp TTM revenue decline, volatile leverage (rising in TTM), and uneven cash-flow trends with weak/negative operating cash flow coverage in TTM.

Income Statement

Profitability is strong overall, with healthy net income generation across the annual periods and particularly elevated margins in TTM (Trailing-Twelve-Months). However, the top-line trajectory has weakened materially: revenue is down sharply in TTM (Trailing-Twelve-Months) versus the prior period, and revenue growth has been inconsistent over the past few years. This mix suggests earnings power is solid, but near-term momentum and revenue stability are key watch items.

Balance Sheet

The balance sheet shows solid shareholder returns (return on equity consistently in the low-to-mid teens), indicating effective use of capital. Leverage looks moderate in the most recent annual report, but debt-to-equity is volatile across periods and rises in TTM (Trailing-Twelve-Months), which increases balance-sheet risk if operating conditions soften. Overall, the company appears well-capitalized, but the swings in leverage metrics reduce comfort.

Cash Flow

Cash generation is generally supportive of earnings: free cash flow has historically tracked close to net income, and TTM (Trailing-Twelve-Months) free cash flow slightly exceeds net income. The main concern is volatility—free cash flow growth has been highly uneven (including a sizable decline in TTM), and the operating cash flow coverage metric is weak/negative in TTM (Trailing-Twelve-Months), pointing to variability in underlying cash conversion and working-capital/operating flow dynamics.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	473.60B	497.85B	497.59B	477.40B	450.36B	225.61B
Gross Profit	250.44B	334.86B	336.65B	342.26B	327.22B	225.61B
EBITDA	176.50B	194.24B	192.06B	179.72B	161.70B	-2.49B
Net Income	148.78B	148.39B	146.60B	138.01B	119.92B	97.34B
Balance Sheet
Total Assets	12.65T	12.15T	11.03T	10.14T	9.25T	8.36T
Cash, Cash Equivalents and Short-Term Investments	0.00	1.21T	1.07T	960.91B	846.62B	876.67B
Total Debt	1.61T	471.07B	436.55B	429.69B	631.11B	503.90B
Total Liabilities	11.52T	10.92T	9.94T	9.18T	8.38T	7.63T
Stockholders Equity	1.12T	1.23T	1.08T	945.50B	858.75B	723.75B
Cash Flow
Free Cash Flow	290.31B	412.09B	327.59B	535.25B	157.89B	402.20B
Operating Cash Flow	314.79B	447.02B	357.75B	570.14B	182.05B	421.33B
Investing Cash Flow	-517.42B	-292.86B	-255.11B	-513.93B	-19.70B	-240.75B
Financing Cash Flow	-97.13B	2.15B	-72.99B	-297.03B	89.36B	-211.79B

China Merchants Bank Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 32.34
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CIHKY, the sentiment is Negative. The current price of 32.34 is above the 20-day moving average (MA) of 31.08, above the 50-day MA of 31.98, and above the 200-day MA of 30.91, indicating a bearish trend. The MACD of -0.52 indicates Negative momentum. The RSI at 43.39 is Neutral, neither overbought nor oversold. The STOCH value of 92.46 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CIHKY.

China Merchants Bank Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
USB	78 Outperform	$87.22B	12.15	12.18%	3.77%	2.91%	33.77%
PNC	75 Outperform	$87.09B	13.46	11.99%	3.11%	1.79%	30.93%
HDB	71 Outperform	$155.97B	19.37	14.06%	3.03%	-1.78%	0.65%
IBN	69 Neutral	$105.71B	17.15	16.66%	0.85%	10.85%	7.98%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
MFG	64 Neutral	$108.94B	15.88	9.14%	2.31%	-2.84%	25.48%
CIHKY	60 Neutral	$142.93B	7.48	14.30%	4.24%	-4.34%	2.00%