Stock Market

CIBC RAISED DIVIDENDS — Should I buy NOW?

Canadian Imperial Bank of Commerce (TSE:CM) has released its third quarter results yesterday and hiked its quarterly dividend by three cents to $1.30 per share due to its stronger-than-expected profit.

If you have been following my blog, you know I have CIBC in my watchlist because of the company’s strong fundamental in the past and its high annual return on dividends.

In addition, you would know that I need to save $18,000 as my “EMERGENCY FUND” for my condo.  I still need $8,800 and I plan to invest this money into the stock market (just in case I will not need it and the money would be growing on its own already).

With the stock trading in the lowest since July (the current price is $105.57), is it time to buy now?

Here is the financial statement analysis from 2013 to July 2017:

Screen Shot 2017-08-25 at 2.52.47 PM

Ultimately, I think CIBC still exhibit long-term competitive advantage because of the following reasons:

  • low return on capital expenditure
  • goodwill increased (CIBC just acquired The PrivateBank on June 2017, an private American bank that provides middle market commercial banking, personal and small business banking, and private banking and investment management services)
  • increase in net income on total revenue
  • general decrease in selling, administrative and general expense
  • increasing retained earnings

BUT…

should I enter the market now or anticipate the stock price would drop even lower in order to maximize my return?

In the next post, we will look at technical analysis and trading signals for the CIBC stock. Please feel free to comment below! Catch you on the flip side!

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