CBA – Earnings Report 12th Feb

Commonwealth Bank  is priced for a strong result on February 12, so the potential for disappointment is high. The stock remains under Algo Engine sell conditions and despite the prospect of a $2.5bn on market share buy-back, we remain on the short side of the stock.

CBA has re-rated to a P/E multiple of 17x and a dividend yield of 5%.



CBA Earnings

Commonwealth Bank of has announced FY19 cash earnings of $8,5bn, slightly below consensus estimates. The full-year dividend of $4.30 was in line with estimates and places the stock on a 5.1% yield.

Weak revenues were a clear issue with and FY20 headwinds on both revenues and costs will see downside pressure build for the CBA share price.



CBA – Algo Sell Signal

Commonwealth Bank of is under Algo Engine sell conditions and we’ll get insight into the earnings picture when the company reports their FY19 results on Wednesday 7th August.

We remain concerned about the declining profitability in retail banking.

With the stock trading on a  5% dividend yield, we expect to see buying support develop closer to the $75 price range.



CBA – Earnings & Valuation Review

Commonwealth Bank of Australia reported 3Q19 cash earnings of A$2.2bn,
being below market consensus by 10%.

Analysts have downgraded FY19 earnings by 6%, (which incorporates the $500m post tax remediation charge), while FY20 and FY21 estimates are also lowered on weaker revenue numbers.

CBA currently trades 13x earnings on a 5.8% yield. A key risk for the business is an adverse turn in the credit cycle, which is not reflected in the current share price.

CBA has been under Algo Engine sell conditions following the lower high formation over the past 3 years.






Commonwealth Bank – Earnings Update

CBA reported their 1H19 earnings today and the number was slightly below market consensus. The miss was attributable to greater-than-expected margin pressure in their home loan book and costs in insurance.

Revenue came in at $12.4bn and pre-provision cash earnings at 7.1bn.

CBA is under Algo Engine sell conditions. The only one of the 4 majors, currently displaying a buy signal and held in our ASX model portfolio is ANZ.

CBA goes ex-div on the 14th of Feb $2.01 which places the stock on a 5.9 yield.




CBA – Algo Sell Signal

The post below is from the 12th of Jan. CBA has since sold-off and is now trading $5 lower at $68.

Our Algo Engine has highlighted a number of lower high sell signals in CBA over the past 2 years. The most recent signal occurred in November last year when CBA was trading at $73.

Following the last signal, CBA made a  low at $67 and has now rallied back to trading at the $73 resistance level again.

We remain cautious as we now start to see the short-term indicators turn lower.

Above chart is from 12th Jan.

Above chart is from 1 Feb.