Canadian Imperial Bank of Commerce (CM.TO)

Canadian banks are reasonably priced, but still headwinds on loan losses. He likes the one with the best balance sheet, TD. He also likes CM, with its outsized dividend yield and low valuation. BMO is OK.

For the heavy lifting in your portfolio, he'd look instead at insurance companies with similar yields and more growth over the next 1-2 years.

Cheap. 1.4-1.6x book value. Trades around 10x earnings. A great business. Tough time recently, partly due to what's happened with US banks. Higher rates increased costs, loan losses went up. Will be substantially higher 1-2 years from now. Yield is almost 6%.

CIBC has outperformed BNS year to date. Which stock is less bad (negative)? Do you want to hold any banks? He prefers insurance though he owns TD. Every banks has been down for a while. That said, these two banks have gone sideways since November. He prefers BMO, Royal or insurance.

Likes Canadian banks as a group, well capitalized. She doesn't own CM, as its domestic nature makes it more sensitive to mortgage market volatility. She favours TD and RY, with exposure to US growth. 

Around 65% of CBIC's loans have exposure to real estate, with 55% consumer and 10% commercial. CIBC's higher exposure to real estate does make it relatively riskier, and it is one of the smaller banks. Still, its valuation of less than 8X earnings reflects some, or even all, of this risk. We would still be comfortable owning the stock, but until recession fears go away or rates peak it may not do much.
Unlock Premium - Try 5i Free

There'll be little disparity among the big banks though CM depends more on Canadian mortgages. Long-term, the big banks will pay you 10-15% returns annually, though they haven't been giving that in recent years. He prefers RY because of its slightly higher ROE and is more diversified.

Seen as most troubled Canadian bank. Regulatory scrutiny on balance sheet. Among the highest dividends. Prefers RY and TD for the stronger balance sheets. May have more downside, but don't be afraid of it. 

You can hold it for income. Dividend is safe for sure. Less foreign exposure, so this will benefit them in the short term. Canadian assets continue to grow. Best quarterly results of all the banks. Mortgage book and credit cards could come under pressure. He prefers other banks, based on history with CM. Pretty compelling yield of 6.2%.

A good entry point. Pays a safe 6% dividend yield. Price to book is closer to 1x among its peers. Yes, their mortgage exposure is larger than its peers, but it won't hurt CM long-term.

Has more Canadian housing exposure, so in an economic downturn, they could get hit more than their peers. But that would be a buying opportunity. Likes managers. More upside than Royal Bank, but more downside in the short-term. Volatile in the short term.

Still likes it. Very discounted with what's happening in the financial world, especially in the US. An opportunity for long-term investors, around 8x earnings, yield 5.9%. 

Might break down trend, but unsure.
Banks in general perform well in rising interest rate environment.
Current lid suggest good time to buy. 

A bit like chalk and cheese. CM is the most domestic and Canadian bank. BNS is the most international, especially in Latin America. BNS has more risk because of all that could go wrong in developing countries. CM has more risk because it rarely has found a log that it couldn't trip itself over. Invest with the one that you bank with. It will at least be emotionally satisfying, as your bank charges will be covered by dividends, which will increase regardless.