CM
Canadian Imperial Bank of Commerce
$115.49
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Overvalued
Trading 27.1% above fair value
You pay
$115.49
Bear
$63.63
Fair
$90.89
Bull
$118.17
Bear
$63.63
-44.9%
ROTCE 11.3% → 0.98x TBV
Fair
$90.89
-21.3%
ROTCE 15.1% → 1.49x TBV
Bull
$118.17
+2.3%
ROTCE 17.4% → 1.79x TBV
Key Value Driver
ROTCE (15.1%) vs. cost of equity (11.5%)
Implied Market Multiple
2.65x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $106.62 from 15 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $90.89 per share.
Warnings
Traditional cash flow models don't work well for banks — lending activity distorts how much cash the business actually generates.
Common valuation shortcuts don't apply here — for banks, interest payments are a core business cost, not overhead.
Financial statements were converted from CAD into USD using USDCAD at 0.7239 USD per CAD.
Key Risks
- Book value quality matters as much as level — check loan loss reserves
- Interest rate sensitivity creates non-linear earnings surprises
- Insurance reserving is actuarial, not financial — errors emerge slowly