Insights

Here’s why the CBA (ASX:CBA) share price has beaten the ASX 200 in the last 3 months

The company’s shares have moved higher since June…
The post Here’s why the CBA (ASX:CBA) share price has beaten the ASX 200 in the last 3 months appeared first on The Motley Fool Australia. –

The Commonwealth Bank of Australia (ASX: CBA) share price has been treading higher in recent times. In fact, shares in Australia’s largest bank have outpaced the S&P/ASX 200 Index (ASX: XJO) over the past 3 months. Correspondingly, a 3% gain versus a 0.9% lift.

At Friday’s closing bell, CBA shares increased their lead further by adding 0.89% to $101.70. On the other hand, the ASX 200 Index lost 0.43% to 7,338.3 points.

What’s driving CBA shares higher?

Investors have been buying up on the CBA share price in 2021 as the company continues to impress the market.

According to last month’s full-year results, CBA reported a 19.7% jump on statutory net profit after tax to $8,843 million. This was driven by an improvement in Australia’s economic conditions and outlook.

Cash earnings swelled 19.8% to $8,653 million, with loan impairment expenses declining 78% to $554 million.

In addition, net interest margin fell 4 basis points to 2.03% due to higher liquid assets. The impact of a low-rate environment had been largely offset by management actions. The bank achieved lower wholesale funding costs and a favourable funding mix.

It’s worth noting that CBA has conducted a $6 billion off-market share buy-back to reduce surplus capital and increase shareholder value. The capital management program will see about a 3.5% reduction of its total shares on the registry.

Basically, this means that when CBA buys back its shares, the number of shares on its registry will decrease. With a lesser amount, this effectively increases the value of each share as the revenue and profits remain the same.

Historically, when this occurs, a company’s share price tends to rise over time.

CBA share price snapshot

Over the last 12 months, CBA shares have advanced almost 60%, with year to date hovering above 20%. In comparison, the ASX 200 Index has achieved returns of 24% and 12% respectively.

CBA has a market capitalisation of roughly $179.95 billion, making it the largest company on the ASX.

The post Here’s why the CBA (ASX:CBA) share price has beaten the ASX 200 in the last 3 months appeared first on The Motley Fool Australia.

Should you invest $1,000 in CBA right now?

Before you consider CBA, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and CBA wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

What’s happening with the CBA (ASX:CBA) share price this week?
CBA (ASX:CBA) share price leads big four banks today despite broker’s bearish view
Top brokers name 3 ASX shares to sell today

CBA (ASX:CBA) share price slumps amid RBA concerns of sector vulnerabilities
CBA (ASX:CBA) share price lower despite latest ‘disruptor’ investment

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!