Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM) stock rose 1.99% on August 28. Shares have dropped 3.2% over the past month. The bank released its third-quarter 2019 results on August 22.
Adjusted net income rose 1% year-over-year to $1.41 billion. It posted strong growth in its U.S. Commercial Banking and Wealth Management segment, mostly due to higher revenue. Net income in CIBC’s Capital Markets segment dropped 13% from the prior year to $231 million.
In the year-to-date period, CIBC has reported adjusted net income of $4.04 billion or $9.07 per share, down from $4.09 billion or $9.10 per share in 2018.
Broader headwinds have had a negative impact on CIBC and the other big banks, but the central story at CIBC has been the housing slowdown. CIBC bet big on growth in big metropolitan areas, and housing in these areas suffered a sharp drop over the past two years.
Fortunately, the Canadian housing market has enjoyed a rebound in the spring and summer of 2019. For the first time since 2016, Canadians are looking at a balanced market. Low interest rates are expected to underpin this market in the near term.
CIBC stock had a favourable price-to-earnings ratio of 8.7 and a price-to-book of 1.2 as of close on August 28. The bank also hiked its quarterly dividend to $1.44 per share which represents a tasty 5.6% yield.
