Company Reports

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported decent fiscal first-quarter earnings that were largely in line with our expectations, as solid fee results were offset by higher credit costs. Adjusted net income, which excludes the CAD 91 million FDIC special assessment charges and other noncore miscellaneous charges, decreased by 4% from a year ago to CAD 1.8 billion. Adjusted earnings per share were CAD 1.81, representing an increase of 15% quarter over quarter and a decrease of 7% year over year. Given that first-quarter results and management's outlook all largely align with our previous views of CIBC, we maintain our current fair value estimate of CAD 64/USD 48, and we view shares as fairly valued.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canada-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the United States. Although CIBC has one of the larger domestic branch networks, its products haven’t typically had top share in Canada, though the bank has made significant strides since 2011, as it increased share in multiple categories and increased product numbers per customer. This improvement has slowed recently, however.

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported decent fiscal fourth-quarter earnings. Adjusted earnings per share were CAD 1.57, representing an increase of 13% year over year and 3% quarter over quarter. Last quarter was a bit more difficult, driven by outsize provisioning compared with peers, however, CIBC made a bit of a comeback this quarter as the bank saw an improvement in its provisioning ratio while peers are seeing increases.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canada-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the United States. Although CIBC has one of the larger domestic branch networks, its products haven’t typically had top share in Canada, though the bank has made significant strides since 2011, as it increased share in multiple categories and increased product numbers per customer. This improvement has slowed recently, however.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canada-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the United States. Although CIBC has one of the larger domestic branch networks, its products haven’t typically had top share in Canada, though the bank has made significant strides since 2011, as it increased share in multiple categories and increased product numbers per customer. This improvement has slowed recently, however.

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported OK fiscal third-quarter results. Adjusted earnings per share were CAD 1.52, representing an 18% decline year over year and 17% decline sequentially, largely driven by outsized provisioning. Results generally fit within the overall pattern we expected for the Canadian banks this year, as we envisioned slowing loan growth, an increase in credit strain, and some pressure on net interest income growth.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canadian-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the U.S. Despite having one of the larger domestic branch networks, CIBC’s products haven’t typically had top share in Canada, though the bank had made significant strides in multiple categories for years starting in 2011, as the bank increased share in multiple categories and increased product numbers per customer. This improvement has admittedly slowed down recently.

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported OK fiscal second-quarter earnings. Adjusted earnings per share were CAD 1.70, representing a decline of 4% year over year and a decline of 12% quarter over quarter. Results generally fit within the overall pattern we expect for the Canadian banks this year, as we looked for slowing loan growth, an increase in credit strain, and some pressure on net interest income, or NII, growth.

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported mixed fiscal first-quarter earnings. We expect this quarter and ultimately this year to be a bit of a transition year for the Canadian banks. Loan growth is likely to slow, more credit strain is likely to emerge, and net interest income remains in a state of flux as rate changes slowly feed through the balance sheets. Many of these patterns were present for CIBC in the quarter, with loan growth slowing to less than 1% sequentially, write-offs and delinquencies marching a bit higher, and net interest income, or NII, still struggling to show much growth (up only half a percent sequentially). CIBC is the first of the major Canadian banks to report, so we don't have much data for peer comparisons yet, but we would imagine some of these trends will appear for other banks as well, although NII growth may be stronger for some peers. The second half of the year will be a key moment for CIBC, as management expects NII growth and NIM expansion will accelerate, which would be a change of pace from the current trends.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canadian-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the U.S. Despite having one of the larger domestic branch networks, CIBC’s products haven’t typically had top share in Canada, though the bank had made significant strides in multiple categories for years starting in 2011, as the bank increased share in multiple categories and increased product numbers per customer. This improvement has admittedly slowed down recently.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canadian-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the U.S. Despite having one of the larger domestic branch networks, CIBC’s products haven’t typically had top share in Canada, though the bank had made significant strides in multiple categories for years starting in 2011, as the bank increased share in multiple categories and increased product numbers per customer. This improvement has admittedly slowed down recently.

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported mixed fiscal fourth-quarter earnings. During this quarter, a key differentiating factor between decent results and weaker results was the ability to grow net interest income, or NII, sequentially, combined with a positive operating leverage outlook for 2023. Unfortunately, CIBC failed these tests in the current quarter.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canadian-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the U.S. Despite having one of the larger domestic branch networks, CIBC’s products haven’t typically had top share in Canada, though the bank had made significant strides in multiple categories for years starting in 2011, as the bank increased share in multiple categories and increased product numbers per customer. This improvement has admittedly slowed down recently, although the bank took some incremental share again in 2021. Overall, we believe CIBC has improved its core operating performance over the years, and while the improvement has slowed and the bank's expense base is rising as CIBC continues to invest in technology and other aspects of the franchise, we still see the bank making incremental improvements over the medium term.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canadian-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the U.S. Despite having one of the larger domestic branch networks, CIBC’s products haven’t typically had top share in Canada, though the bank had made significant strides in multiple categories for years starting in 2011, as the bank increased share in multiple categories and increased product numbers per customer. This improvement has admittedly slowed down recently, although the bank took some incremental share again in 2021. Overall, we believe CIBC has improved its core operating performance over the years, and while the improvement has slowed and the bank's expense base is rising as CIBC continues to invest in technology and other aspects of the franchise, we still see the bank making incremental improvements over the medium term.

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported OK fiscal third-quarter earnings. Adjusted earnings per share were CAD 1.85, representing a year-over-year decline of 6% and sequential growth of 5%. Preprovision pretax, or PPPT, earnings were up 10% year over year, with provisioning being the key difference between PPPT earnings and net income. The biggest point of weakness for the Canadian banking sector in this quarter has been fees, particularly within the more market- and activity-sensitive investment banking, trading, and wealth businesses. CIBC saw a similar trend for investment banking and wealth fees; however, the bank outperformed on trading fees, which helped offset some of the other fee pressure, so we don’t expect to have to adjust our 2022 fee outlook downward as much for CIBC as we have for some peers. Solid balance sheet growth helped net interest income expand 5% sequentially, a solid result. Finally, expenses are coming in a bit ahead of where we expected, as spending on strategic initiatives is driving some additional expense growth. As we adjust our expense outlook slightly higher, we do not expect a material change in our fair value estimate of CAD 77/USD 60. Overall, preprovision net revenue is still on track to meet management’s goal of 5%-10% for the year.

Narrow-moat-rated Canadian Imperial Bank of Commerce, or CIBC, reported decent fiscal second-quarter earnings. Adjusted earnings per share were CAD 1.77, fairly close to the CapIQ consensus of CAD 1.71 and representing a year-over-year decline of 1%. The bank recorded a credit loss provision of CAD 303 million, which was the key reason for the decline in year-over-year earnings, as pre-provision net revenue was actually up 4%. While some peers were still seeing low provisioning costs and even provisioning benefits in some cases, CIBC’s acquisition of the Costco card portfolio and some negative tweaks to its economic outlook helped drive provisioning higher in the quarter. We are at a point where we should see provisioning begin to normalize higher for the industry. We’ll note that this level of provisioning is simply a return to normal after a year of exceptionally low provisioning.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canadian-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the U.S. Despite having one of the larger domestic branch networks, CIBC’s products haven’t typically had top share in Canada, though the bank had made significant strides in multiple categories for years starting in 2011, as the bank increased share in multiple categories and increased product numbers per customer. This improvement has admittedly slowed down recently, although the bank took some incremental share again in 2021. Overall, we believe CIBC has improved its core operating performance over the years, and while the improvement has slowed and the bank's expense base is rising as CIBC continues to invest in technology and other aspects of the franchise, we still see the bank making incremental improvements over the medium term.

Narrow-moat rated Canadian Imperial Bank of Commerce reported solid fiscal first-quarter earnings. Adjusted earnings per share were CAD 4.08, coming in above the Factset consensus estimate of CAD 3.68. The bank’s results were strong across the board, producing a return on equity of 18%. Revenue was up 11% year over year, driven by net interest income growth of 10% and fee growth of 11%. With rate hikes coming up, we expect momentum for net interest income should continue. Expenses were up 10%, allowing the bank to generate pretax pre-provision growth of 11% year over year. This led to 14% growth in diluted EPS year over year. Based on these results, we don’t anticipate any material change to our fair value estimate of CAD 156/USD 122.

Narrow-moat rated Canadian Imperial Bank of Commerce reported decent fiscal fourth-quarter earnings. Adjusted earnings per share were CAD 3.37, coming in below Factset consensus estimates for CAD 3.54. Revenue slightly missed consensus as underwriting and advisory fees and trading fees dropped a bit, but this is something we’ve seen for the industry. We think expenses were the biggest disappointment, which came in above our projections as they increased 7% on a reported basis and 5% on an adjusted basis. We think this was the biggest question mark from earnings and from the call.

Canadian Imperial Bank of Commerce is the fifth-largest bank in Canada by assets and one of six that collectively hold almost 90% of the nation's banking deposits. CIBC is more Canadian-focused than some of its more international peers, although this is changing after the acquisition of PrivateBancorp. The bank plans to eventually have up to 25% of revenue coming from the U.S. Despite having one of the larger domestic branch networks, CIBC’s products haven’t typically had top share in Canada, though the bank had made significant strides in multiple categories for years starting in 2011, as the bank increased share in multiple categories and increased product numbers per customer. This improvement has admittedly slowed down recently, although the bank appears to be taking incremental share again in 2021. Overall, we believe CIBC has improved its core operating performance over the years, and while the improvement has slowed and the bank's expense base is still rising as CIBC continues to invest in technology and other aspects of the franchise, we still see the bank making incremental improvements over the medium term.