Is It Too Late To Consider CIBC After Its Strong 2025 Share Price Rally?

• Wondering whether Canadian Imperial Bank of Commerce is still good value after such a strong run, or if new investors might be turning up late to the party, this article will walk through what the numbers are really saying about the stock.
• The share price has recently pulled back by 0.3% over the last week, but that sits against a 3.4% gain over 30 days, a 39.6% rise year to date and a 42.1% gain over the past year that builds on multi year returns of 164.1% over 3 years and 188.3% over 5 years.
• Recent headlines have focused on Canadian banks reshaping their balance sheets, tightening risk management and repositioning for slower economic growth. All of this matters for how investors think about future profitability and dividends. At the same time, regulatory commentary about capital buffers and competition in the domestic lending market has reinforced the idea that not all bank valuations will move in lockstep.
• Right now, Canadian Imperial Bank of Commerce scores a 3/6 valuation check score, suggesting it screens as undervalued on some but not all of the key metrics we track. Next we will break down what that means across different valuation approaches, before finishing with a more complete way to connect valuation to the bigger picture story.

Find out why Canadian Imperial Bank of Commerce's 42.1% return over the last year is lagging behind its peers.

Approach 1: Canadian Imperial Bank of Commerce Excess Returns Analysis

The Excess Returns model looks at how much value Canadian Imperial Bank of Commerce can create above the return that investors reasonably demand, then capitalizes those surplus earnings into an intrinsic value per share.

For Canadian Imperial Bank of Commerce, the model starts with a Book Value of CA$67.37 per share and a Stable EPS estimate of CA$10.14 per share, based on weighted future Return on Equity forecasts from 13 analysts. With an Average Return on Equity of 14.52% and a Stable Book Value projected at CA$69.88 per share from 10 analysts, the bank is expected to keep earning profits on its equity base.

The Cost of Equity is estimated at CA$5.06 per share, while the Excess Return is CA$5.08 per share. In other words, the model suggests that roughly half of each dollar of earnings is value created over and above investors' required return. When these excess returns are projected forward and discounted, the resulting intrinsic value comes out at around CA$182.96 per share, which implies the stock is about 31.0% undervalued versus the current price.

Result: UNDERVALUED

Our Excess Returns analysis suggests Canadian Imperial Bank of Commerce is undervalued by 31.0%. Track this in your watchlist or portfolio, or discover 907 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Canadian Imperial Bank of Commerce.

Approach 2: Canadian Imperial Bank of Commerce Price vs Earnings

For a profitable, established bank like Canadian Imperial Bank of Commerce, the price to earnings, or PE, multiple is a straightforward way to gauge whether the market price makes sense relative to the profits the business is generating. Because earnings are the primary driver of long term returns for bank investors, PE is often the go to yardstick.

In practice, what counts as a normal or fair PE depends on how quickly earnings are expected to grow and how risky those earnings are. Stronger growth and more predictable results can justify a higher PE, while slower or more volatile earnings usually warrant a lower one. Canadian Imperial Bank of Commerce currently trades on a PE of 14.48x, compared with an average of 10.84x for the Banks industry and about 15.04x for peers. This suggests the market is pricing it at a modest premium to the sector but broadly in line with comparable companies.

Simply Wall St also calculates a Fair Ratio of 14.01x for Canadian Imperial Bank of Commerce, which is the PE you might expect once you factor in its earnings growth outlook, margins, risk profile, industry and market cap. This is more tailored than a simple peer or industry comparison because it directly links valuation to the company’s own fundamentals rather than relying on broad averages. With the current PE only slightly above this Fair Ratio, the stock appears close to fairly valued on this lens.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1456 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Canadian Imperial Bank of Commerce Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, which are simply your story about a company captured in numbers, where you link your view of Canadian Imperial Bank of Commerce’s future revenue, earnings and margins to a forecast and a fair value, then compare that fair value to today’s price to decide whether it looks like a buy or a sell. On Simply Wall St’s Community page, used by millions of investors, Narratives make this process easy and accessible, guiding you to spell out why you think the bank’s net interest margins, credit costs and growth opportunities will evolve the way they will, then automatically updating your fair value as fresh information such as earnings releases or major news arrives. For example, one investor might build a more bullish Narrative that leans toward a fair value closer to CA$123 per share, while a more cautious investor could anchor on a fair value nearer CA$78, and both can see in real time how their different assumptions translate into different buy, hold or sell conclusions as the market price of Canadian Imperial Bank of Commerce moves.

Do you think there's more to the story for Canadian Imperial Bank of Commerce? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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