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Canadian Imperial Bank Of Commerce (TSE:CM)
TSX:CM
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Canadian Bank of Commerce
(TSX:CM)
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Rating:78Outperform
Price Target:
C$118.00
▲(0.14% Upside)
The Canadian Bank of Commerce's strong financial performance, attractive valuation, and positive earnings call results are the primary drivers of its stock score. While technical indicators suggest potential short-term volatility, the bank's robust capital position and strategic growth initiatives, particularly in digital and AI innovations, support a positive long-term outlook. Attention to increased leverage and credit loss provisions is advised.
Positive Factors
Digital and AI Innovations
The bank's focus on digital and AI innovations enhances customer experience and operational efficiency, positioning it strongly in the evolving financial services landscape.
Capital Markets Growth
Strong growth in capital markets indicates effective strategic positioning and capability in capturing market opportunities, contributing to diversified revenue streams.
Robust Capital Position
A strong capital position with a solid CET1 ratio ensures financial stability and flexibility, supporting future growth initiatives and shareholder returns.
Negative Factors
Increased Provisions for Credit Losses
Rising credit loss provisions reflect potential risk exposure in the loan portfolio, which could impact profitability if economic conditions worsen.
U.S. Commercial Real Estate Challenges
Challenges in U.S. commercial real estate could limit growth and profitability in this segment, requiring strategic adjustments to mitigate risks.
Mortgage Delinquency Increase
Rising mortgage delinquencies, especially in key regions, may signal underlying economic stress, potentially affecting the bank's credit quality and risk profile.
Canadian Bank of Commerce (CM) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$109.53B
Dividend Yield3.29%
Average Volume (3M)3.29M
Price to Earnings (P/E)14.2
Beta (1Y)0.82
Revenue Growth-0.39%
EPS Growth20.28%
CountryCA
Employees48,698
SectorFinancial
Sector Strength70
IndustryBanks - Diversified
Share Statistics
EPS (TTM)2.16
Shares Outstanding929,451,000
10 Day Avg. Volume2,642,968
30 Day Avg. Volume3,288,868
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap2.38
Enterprise Value/Revenue5.98
Enterprise Value/Gross Profit9.92
Enterprise Value/Ebitda21.81
Forecast
1Y Price Target
$111.64Price Target Upside-5.26% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Canadian Bank of Commerce Business Overview & Revenue Model
Company DescriptionThe Canadian Bank of Commerce (CM) is a leading financial institution in Canada, providing a wide range of banking and financial services to individuals, businesses, and institutions. Operating primarily in the retail and commercial banking sectors, CM offers products such as personal and business banking accounts, loans, mortgages, investment services, and wealth management solutions. The bank is committed to delivering customer-centric services and leveraging technology to enhance customer experience.
How the Company Makes MoneyThe Canadian Bank of Commerce generates revenue through various key streams, primarily focusing on net interest income from loans and deposits. The bank earns interest from loans provided to customers, which is typically higher than the interest it pays on deposits, creating a profit margin. Additionally, CM generates fee-based income from services such as account maintenance fees, transaction fees, and advisory services. Investment income from wealth management and investment products also contributes to the bank's revenue. Significant partnerships with financial technology firms allow CM to innovate and enhance its service offerings, further boosting its earnings potential.
Canadian Bank of Commerce Earnings Call Summary
Earnings Call Date:Aug 28, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Dec 04, 2025
Earnings Call Sentiment Positive
CIBC reported a strong quarter with significant growth in net income, robust capital position, and positive operating leverage. The bank's digital and AI advancements were highlighted as key achievements. However, increased provisions for credit losses and challenges in the U.S. commercial real estate sector were notable concerns. Mortgage delinquency rates also showed some increase, particularly in stress-prone regions.Q3-2025 Updates
Positive Updates
Strong Financial Performance
CIBC delivered net income of $2.1 billion, up 11% from the prior year, and earnings per share of $2.16, up 12%. Pre-provision, pre-tax earnings also increased by 12%.
Robust Capital Position
The bank ended the quarter with a CET1 ratio of 13.4%, while repurchasing 5.5 million common shares. Announced intention to launch another normal course issuer bid for 2% of outstanding common shares.
Positive Operating Leverage
CIBC achieved its 8th consecutive quarter of positive operating leverage, aided by broad-based growth and healthy margin expansion.
Digital and AI Innovations
CIBC's digital banking capabilities were recognized with the highest ranking in customer satisfaction in the J.D. Power study. Their AI-powered voice assistant won the 2025 Digital CX Award for Best Use of AI for Customer Experience.
Capital Markets Growth
CIBC Capital Markets reported a 43% increase in net income year-over-year, driven by higher underwriting, advisory activity, and global markets revenues.
Negative Updates
Increased Provisions for Credit Losses
Total provision for credit losses was up 16% from a year ago, with impaired PCLs at 33 basis points. This is due to an evolving economic environment.
U.S. Commercial Real Estate Challenges
Continued execution of a strategy to move away from certain commercial real estate elements, leading to slightly higher payoff activity and reduced utilization rates.
Mortgage Delinquency Increase
90-plus day delinquencies in the mortgage portfolio showed a moderate increase, with GVA and GTA regions exhibiting more stress.
Company Guidance
During the CIBC Q3 2025 earnings call, the bank reported robust financial results with key metrics indicating strong performance. CIBC achieved an adjusted net income of $2.1 billion, reflecting an 11% increase from the previous year, and an earnings per share of $2.16, up 12%. The bank's return on equity improved to 14.2%, marking the fifth consecutive quarter of year-over-year ROE improvement. The CET1 ratio stood at a solid 13.4%, and CIBC repurchased 5.5 million common shares, highlighting a strong capital position. The bank's operating leverage remained positive for the eighth consecutive quarter, driven by a 12% increase in pre-provision, pre-tax earnings and broad-based growth across all business units. The provision for credit losses increased by 16% year-over-year but remained within guidance, with impaired losses favorably low. CIBC continued to outperform in key areas such as digital banking, client satisfaction, and strategic client growth, particularly in capital markets, where U.S. revenue growth was up 37% year-to-date. The bank also announced plans for a new normal course issuer bid for 2% of its outstanding common shares, indicating confidence in its earnings trajectory and balance sheet strength.Canadian Bank of Commerce Financial Statement Overview
Summary
The Canadian Bank of Commerce demonstrates strong revenue growth and profitability, though margins have slightly decreased. The balance sheet shows increased leverage, which could be a risk if not managed properly. Cash flow generation is robust, with significant growth in free cash flow. Overall, the financial health is solid, but attention to leverage and cash conversion is advised.Income Statement
The Canadian Bank of Commerce shows strong revenue growth with a 24.84% increase in TTM, indicating robust business expansion. The gross profit margin is healthy at 60.34%, and the net profit margin is solid at 18.63%, reflecting effective cost management. However, the margins have decreased compared to the previous year, suggesting potential pressure on profitability.85
Very Positive
Balance Sheet
The bank's debt-to-equity ratio has increased to 5.90, indicating higher leverage, which could pose a risk if not managed carefully. Return on equity is strong at 13.31%, showing efficient use of equity to generate profits. The equity ratio is stable, but the high leverage remains a concern.70
Positive
Cash Flow
Free cash flow has grown by 23.6% in the TTM, indicating improved cash generation. The operating cash flow to net income ratio is low, suggesting potential issues in converting income into cash. However, the free cash flow to net income ratio is high at 93.56%, showing strong cash flow relative to earnings.78
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 43.63B | 23.61B | 21.31B | 20.78B | 19.86B | 16.25B |
| Gross Profit | 26.32B | 23.52B | 21.29B | 20.80B | 19.80B | 16.25B |
| EBITDA | 11.97B | 10.34B | 8.05B | 8.97B | 9.28B | 5.80B |
| Net Income | 8.13B | 7.12B | 5.00B | 6.22B | 6.43B | 3.79B |
Balance Sheet | ||||||
| Total Assets | 1.10T | 1.04T | 975.72B | 943.60B | 837.68B | 769.55B |
| Cash, Cash Equivalents and Short-Term Investments | 139.28B | 93.25B | 80.52B | 92.72B | 88.15B | 117.07B |
| Total Debt | 369.24B | 208.49B | 194.50B | 187.45B | 164.17B | 45.86B |
| Total Liabilities | 1.04T | 982.98B | 922.51B | 893.22B | 791.85B | 728.22B |
| Stockholders Equity | 62.60B | 58.73B | 52.98B | 50.18B | 45.65B | 41.15B |
Cash Flow | ||||||
| Free Cash Flow | 16.17B | 10.00B | 11.14B | 21.61B | -4.17B | 59.99B |
| Operating Cash Flow | 17.29B | 11.09B | 12.15B | 22.71B | -3.33B | 60.30B |
| Investing Cash Flow | -6.12B | -20.75B | -20.76B | -24.39B | -3.51B | -19.41B |
| Financing Cash Flow | -3.80B | -2.61B | -2.16B | -1.61B | -1.95B | -1.22B |
Canadian Bank of Commerce Technical Analysis
Positive
117.84
Price Trends
110.68
Positive
104.07
Positive
94.38
Positive
Market Momentum
1.70
Negative
70.63
Negative
77.12
Neutral
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 117.84 is above the 20-day moving average (MA) of 114.19, above the 50-day MA of 110.68, and above the 200-day MA of 94.38, indicating a bullish trend. The MACD of 1.70 indicates Negative momentum. The RSI at 70.63 is Negative, neither overbought nor oversold. The STOCH value of 77.12 is Neutral, 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
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| ― | $109.53B | 14.17 | 13.40% | 3.29% | -0.39% | 20.28% | |
| ― | $59.22B | 14.67 | 13.25% | 2.93% | 9.25% | 0.34% | |
| ― | $288.68B | 15.51 | 14.60% | 2.91% | 3.48% | 17.81% | |
| ― | $196.60B | 9.85 | 17.36% | 3.65% | 7.92% | 175.59% | |
| ― | $124.81B | 15.24 | 10.20% | 3.67% | 1.78% | 32.32% | |
| ― | $114.29B | 17.14 | 8.64% | 4.68% | -2.54% | -6.66% | |
| ― | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
TSE:CM
Canadian Bank of Commerce
117.84
33.47
39.67%
TSE:BMO
Bank Of Montreal
175.49
55.53
46.29%
TSE:BNS
Bank Of Nova Scotia
92.36
22.66
32.52%
TSE:RY
Royal Bank Of Canada
207.22
42.79
26.02%
TSE:TD
Toronto Dominion Bank
115.18
42.11
57.63%
TSE:NA
National Bank of Canada
158.21
30.32
23.70%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.