Commonwealth Bank (CBA.AX)
Financials · ASX · Australia
Fundamentals
Valuation and ratings
Commonwealth Bank trades at A$171.17, which is 45% above the A$94.70 our discounted cash flow model puts on the business. On that measure it screens as expensive, which is not the same as saying it will fall.
Our moat model scores it 53 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 27.2 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Commonwealth Bank
Commonwealth Bank of Australia provides retail and commercial banking services in Australia, New Zealand, and internationally. It operates through Retail Banking Services, Business Banking, Institutional Banking and Markets, and New Zealand segments. The company offers savings and term deposit accounts, commonwealth direct investment accounts, and retail transaction accounts, as well as specialized accounts, such as statutory trust, society cheque, farm management, cash and treasury management, and business foreign currency deposit accounts. It also provides credit cards, personal and business loans, car and equipment finance, business overdrafts, margin lending, and international payment services; home loans; and buy-now-pay-later services. In addition, the company provides home and contents, car, health, life, income protection, pet, and travel insurance products. Further, it offers transaction banking, equity trading, and risk management products and services, as well as access to debt capital markets, capital raising, and investment and financial solutions. Commonwealth Bank of Australia was founded in 1911 and is based in Sydney, Australia.
CBA.AX passes 6 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Common questions
Is Commonwealth Bank (CBA.AX) undervalued?
Against our discounted cash flow estimate of A$94.70, CBA.AX at A$171.17 is 45% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
What is CBA.AX's P/E ratio?
CBA.AX trades at 27.2 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.