# Commonwealth Bank of Australia (ASX:CBA)

As of Sun 8 Nov 2026 12:00 UTC (weekly snapshot). Full report: https://standard-equity.report/ASX/CBA

Price A$167.51 (AUD), market cap A$280.0B, Financials - Banks - Diversified.

## Valuation

- SE Reference Value (expected value, DCF): A$88.26 (central 50% range A$81.26 to A$98.07), -47% against the price; range width narrow
- SE Grade: 0 of 3 (half) (Value 0, Quality 1, Moat 3)
- Consensus Rating: Strong Sell (Strong buy 0, Buy 0, Hold 0, Sell 3, Strong sell 11)
- Consensus Price (mean): A$119.07, -29% against the price

## Key metrics

Financials in AUD. Peer percentile: 100 = best in the peer group.

| Metric | Now | 5Y median | 10Y median | Peers |
|---|---|---|---|---|
| Revenue | A$30.15B | CAGR 4.5% | CAGR 2.3% | P20 |
| Revenue growth | 6.6% | 5.1% | 1.8% | P37 |
| NIM | 2.0% | 2.0% | 2.1% | P83 |
| Efficiency ratio | 45.6% | 45.6% | 45.5% | P78 |
| Net margin | 36.0% | 36.0% | 37.4% | P77 |
| Net interest income | A$25.59B | CAGR 5.8% | CAGR 4.3% | - |
| Net interest income growth | 6.5% | 5.3% | 4.3% | P43 |
| ROTE | 15.5% | 15.5% | 15.1% | P73 |
| ROE | 13.8% | 13.8% | 13.7% | P73 |
| ROA | 0.7% | 0.7% | 0.9% | P60 |
| EPS | A$6.49 | CAGR 4.3% | CAGR 1.9% | - |
| EPS growth | 7.5% | 7.5% | 4.0% | P37 |
| Book value per share | A$47.02 | CAGR 2.9% | CAGR 3.4% | - |
| Tangible book value per share | A$41.93 | CAGR 2.5% | CAGR 4.1% | - |
| Dividend per share | A$5.05 | CAGR 7.6% | CAGR 1.8% | - |
| Dividend yield | 3.0% | 3.9% | 4.3% | P50 |
| Payout ratio | 77.8% | 77.8% | 77.8% | P87 |
| Diluted shares | 1,671.8M | CAGR -2.8% | CAGR -0.9% | P20 |
| Buyback yield | 0.1% | 1.8% | 0.1% | P20 |
| Equity/assets | 5.4% | 5.8% | 6.3% | P17 |
| Assets | A$1.452T | CAGR 5.9% | CAGR 4.5% | P27 |
| Long-term debt | A$154.4B | CAGR -1.1% | CAGR -0.2% | P33 |

## Company Note (H2 2026)

Written by AI from the data above.

**Commonwealth Bank closed FY2026** on the strength of business lending, which management said lifted operating performance by 10% and pushed business banking above 40% of cash profit. Net interest income rose on strong lending and deposit growth, partly offset by margin pressure. Collective provisions were raised for forward-looking risks while incurred losses stayed low, so credit costs reflect caution rather than actual losses. The franchise is performing, but the shares already price far more than that: SE fair value of A$88 is 47.3% below the price.

**Management guided FY2027 mortgage credit growth** to a tighter 4%-5% range, with volatility, and an effective tax rate of 30%. It plans to hold the dollar technology envelope flat and expects gross AI benefits to exceed investment next year, as agentic lending scales beyond its first business-loan pilot. Strategy centres on primary relationships through the CommBank app and better institutional capital efficiency. Analysts pressed on why provisions to risk-weighted assets fell. Management "will not trade volume over margin" in mortgages, and consensus expects growth to slow from here.

**The forward numbers leave little room** for the current multiple. Consensus sees FY2027 EPS growth of just 2.3%, slowing to 1.2% in FY2028, on FY2027 revenue growth of 4.3%. That is a bank compounding in low single digits, broadly matching management's measured mortgage guidance and its refusal to chase volume. Nothing in the consensus path points to the kind of acceleration that would close the gap to SE fair value. Earnings would have to run well ahead of these estimates for the valuation to look earned.

**Operating quality is high but not improving**. The efficiency ratio moved from 43.2% in FY2023 to 45.6% in FY2026, worse by 2.4 points, so costs are growing slightly faster than income. Net interest margin of 2.0% sits in line with its five-year median and has been steady over three years. Net margin of 36.0% is likewise steady and above the peer median. Return on tangible equity of 15.5% has held flat. The thin return on assets and the share count are what hold Quality back.

**The valuation is stretched** on every measure we use. SE fair value of A$88 is 47.3% below the price, a high-confidence estimate. The P/E of 25.8x is 55% above its ten-year median of 16.6x, and the P/B of 3.56x is 49% above its 2.39x median. Even the analyst target sits 28.9% below the price. For the price to hold, results must beat the model's base case; an FY2027 EPS print short of consensus would show they are not.

**The SE Score is ½** of 3. Quality earns one star: return on equity of 14% clears a 7.8% cost of equity, but a return on assets of 0.7% is thin for the balance sheet it carries. Moat earns three stars because return on equity has stayed above 12% in each of the last ten years, a record of steady compounding. Value earns no stars, with SE fair value 47.3% below the price, and that premium lowered the business tier one notch to the half rung.

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Weekly snapshot, not live data. For information only, not investment advice. Methodology: https://standard-equity.report/methodology