Canadian Bank of Commerce (CM) AI Stock Analysis

• Market Cap: $91.62B
• Dividend Yield: 3.96%
• Average Volume (3M): 3.53M
• Price to Earnings (P/E): 12.3
• Beta (1Y): 0.88
• Revenue Growth: 5.38%
• EPS Growth: 21.68%
• Country: CA
• Employees: 48,698
• Sector: Financial
• Sector Strength: 80
• Industry: Banks - Diversified
• EPS (TTM): 2.05
• Shares Outstanding: 934,190,550
• 10 Day Avg. Volume: 3,964,508
• 30 Day Avg. Volume: 3,529,910
• PEG Ratio: 3.50
• Price to Book (P/B): 1.49
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.05
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $100.49
• Price Target Upside: 0.93% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 83 Outperform
• Price Target: C$114.00 ▲(14.50%Upside)

CIBC demonstrates robust financial performance and technical strength, supported by solid earnings growth and strategic focus on AI and digital enhancements. While valuation metrics are attractive, high leverage and increased provisions for credit losses pose potential risks. The earnings call highlighted significant growth in income and strategic advancements, contributing positively to the overall score.

Positive Factors

Capital Markets

Corporate and Investment Banking achieved a 16% year-over-year increase in revenue, driven by equity market volatility and increased corporate banking activity.

Earnings

The stock's strong performance was driven by significant earnings in Capital Markets and Canadian Personal & Business Banking.

Financial Stability

The bank maintained strong capital levels with a CET1 ratio of 13.4% and repurchased 6 million shares, indicating financial stability.

Negative Factors

CET1 Ratio

The firm's CET1 ratio was 13.42%, below consensus at 13.55%.

Credit Model Risk

There is a risk of further performing builds in Q3 if the credit model changes, despite some accounting for geopolitical volatility.

US Commercial & Wealth

U.S. Commercial & Wealth earnings missed estimates due to lower-than-expected fee revenue and AUA, despite AUA growth.

Canadian Bank of Commerce Business Overview & Revenue Model

Company Description

Canadian Imperial Bank of Commerce, a diversified financial institution, provides various financial products and services to personal, business, public sector, and institutional clients in Canada, the United States, and internationally. The company operates through four strategic business units: Canadian Personal and Business Banking; Canadian Commercial Banking and Wealth Management; U.S. Commercial Banking and Wealth Management; and Capital Markets. The company offers chequing, savings, and business accounts; mortgages; loans, lines of credit, student lines of credit, and business and agriculture loans; investment and insurance services; and credit cards, as well as overdraft protection services. It also provides day-to-day banking, borrowing and credit, specialty, investing and wealth, and international services; correspondent banking and online foreign exchange services; and cash management services. Canadian Imperial Bank of Commerce was founded in 1867 and is headquartered in Toronto, Canada.

How the Company Makes Money

CIBC makes money through a diverse range of revenue streams, primarily generated from interest income, non-interest income, and capital markets activities. Interest income is derived from loans and mortgages offered to personal and business clients, where the bank earns interest on the amounts borrowed. Non-interest income includes fees from banking services, investment management, and advisory services in wealth management. Additionally, CIBC generates revenue from its capital markets operations, including trading activities, underwriting services, and corporate finance advisory. Strategic partnerships and collaborations also play a role in enhancing CIBC's service offerings and expanding its market reach, contributing to overall earnings.

Canadian Bank of Commerce Financial Statement Overview

Summary

Overall, the Canadian Bank of Commerce exhibits solid financial health with strong revenue growth and profitability. While leverage is moderate, the bank's ability to generate cash flow is robust, although some volatility in free cash flow presents a risk. Continued focus on managing operational costs and maintaining stable cash flow will be crucial for sustaining financial performance.

Income Statement

The Canadian Bank of Commerce demonstrates strong revenue growth, with a TTM revenue increase of 4.1% compared to the previous year. The gross profit margin and net profit margin are robust at 100% and 28.5%, respectively, reflecting efficient cost management. However, there's a notable decline in EBIT margin from the previous periods, suggesting rising operational costs.

Balance Sheet

The bank maintains a healthy equity position with a debt-to-equity ratio of 3.55, indicating a moderate level of leverage. The equity ratio is at 5.67%, which is typical for the banking industry but could be improved. The return on equity shows a solid performance at 12.33%, indicating effective use of shareholder funds.

Cash Flow

Operating cash flow is strong, with a TTM figure significantly higher than net income, yielding a high operating cash flow to net income ratio of 3.87. The free cash flow has shown significant growth of 182.2% over the previous year, although fluctuations in free cash flow over the years indicate potential volatility in cash generation capabilities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	44.41B	25.53B	21.31B	21.76B	19.96B	18.67B
Gross Profit	26.24B	25.53B	23.29B	21.76B	19.96B	18.67B
EBITDA	12.19B	12.36B	8.05B	8.97B	9.28B	5.80B
Net Income	7.82B	7.12B	5.00B	6.22B	6.43B	3.79B
Balance Sheet
Total Assets	1.09T	1.04T	975.72B	943.60B	837.68B	769.55B
Cash, Cash Equivalents and Short-Term Investments	132.62B	93.25B	80.52B	92.72B	88.15B	117.07B
Total Debt	349.01B	208.49B	194.50B	187.45B	164.17B	45.86B
Total Liabilities	1.03T	982.98B	922.51B	893.22B	791.85B	728.22B
Stockholders Equity	61.67B	58.73B	52.98B	50.18B	45.65B	41.15B
Cash Flow
Free Cash Flow	22.61B	10.00B	11.14B	21.61B	-4.17B	59.99B
Operating Cash Flow	14.31B	11.09B	12.15B	22.71B	-3.33B	60.30B
Investing Cash Flow	-16.50B	-20.75B	-20.76B	-24.39B	-3.51B	-19.41B
Financing Cash Flow	5.99B	-2.61B	-2.16B	-1.61B	-1.95B	-1.22B

Canadian Bank of Commerce Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 99.56
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CM, the sentiment is Positive. The current price of 99.56 is above the 20-day moving average (MA) of 95.15, above the 50-day MA of 92.34, and above the 200-day MA of 86.63, indicating a bullish trend. The MACD of 1.97 indicates Negative momentum. The RSI at 82.48 is Negative, neither overbought nor oversold. The STOCH value of 87.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CM.

Canadian Bank of Commerce Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CM	83 Outperform	$91.62B	12.28	13.19%	3.96%	5.38%	21.68%
BMO	77 Outperform	$81.39B	14.56	9.88%	3.94%	15.63%	66.95%
Sector *	67 Neutral	$16.81B	11.85	9.77%	3.76%	12.07%	-8.35%
BNS		$68.33B	15.41	8.00%	5.90%	―	―
RY		$185.77B	14.61	14.17%	3.13%	―	―
TD		$129.83B	10.82	14.27%	3.94%	―	―
NTIOF		$40.38B	13.60	13.42%	3.34%	―	―