If you’ve spent any time looking at the "Big Six" Canadian banks, you’ve probably heard the same old story about CIBC. It’s the "mortgage-heavy" one. The one that’s too exposed to the domestic housing market. The one that’s a bit of a laggard compared to the international reach of an RBC or a TD.
But honestly? That narrative is getting a little stale.
As we sit here in early 2026, Canadian Imperial Bank of Commerce stock is telling a much more nuanced story than the headlines suggest. It’s not just a bet on Toronto condos anymore. The bank has been quietly pulling levers in U.S. commercial banking and capital markets that are finally starting to show up in the bottom line in a big way.
The Numbers Nobody is Talking About
Most investors fixate on the dividend yield—which is admittedly great at around 4.6% currently—but they miss the operational shift. In the 2025 fiscal year, CIBC didn't just meet expectations; they blew past them. We’re talking about a record net income of $8.5 billion.
What’s even more surprising is where that money came from.
While the Canadian personal banking wing grew at a respectable 7%, their U.S. Commercial Banking and Wealth Management arm saw adjusted earnings jump by a staggering 62% year-over-year. That is a massive pivot for a bank once criticized for being stuck inside the Canadian border.
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- Revenue Growth: Total revenue hit $29 billion in 2025, a 14% increase.
- Earnings Per Share: Reported diluted EPS for the full year 2025 was $8.57.
- Dividend Hike: They just bumped the quarterly dividend to $1.07 per share.
It’s easy to look at a stock price near $92 and think you’ve missed the boat. But when you look at the price-to-earnings (P/E) ratio, which is floating around 13.3x for the 2026 forecast, it doesn't actually feel "expensive" compared to historical norms for the sector.
The 2026 Mortgage "Payment Shock" Reality
Let's address the elephant in the room. You can't talk about CIBC without talking about mortgages.
There is a lot of fear-mongering about the 2026 renewal cycle. Basically, a huge chunk of borrowers who took out low-rate loans in 2021 are hitting their renewal dates this year. Some estimates suggest 5% to 6% of the mortgage portfolio could see payment shocks of 40% or more.
That sounds terrifying.
However, CIBC’s Chief Economist, Avery Shenfeld, and Deputy Chief Benjamin Tal have been fairly vocal about why this might not be the "financial apocalypse" bears are predicting. The Bank of Canada has already started easing, with the overnight rate sitting at 2.25% as of January 2026. This isn't the 5% environment people were panicking about a year ago.
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The bank's credit quality is also holding up better than the skeptics expected. Their Provision for Credit Losses (PCL) ratio ended 2025 at 33 basis points. That’s at the very low end of their own guidance. They aren't seeing a wave of defaults; they're seeing a slow, manageable "migration" of credit risk.
Why the U.S. Expansion Matters More Than You Think
A few years ago, the U.S. business was sort of a side quest for CIBC. Now, it's a core engine.
In fiscal 2025, revenue from the U.S. capital markets franchise surged by 39%. This is important because it provides a "capital-light" revenue stream. It means CIBC can grow its profits without having to lend out billions of dollars in risky mortgages to do it.
They are focusing on what they call "connected" banking—helping Canadian clients move south and vice-versa. It sounds like corporate jargon, but the 23% increase in cross-border referrals suggests it's actually working.
The ROE Game
Return on Equity (ROE) is the metric that bank analysts obsess over. CIBC’s ROE for 2025 was 14.4%.
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For 2026, management has set a target of "above 15%." If they hit that, the stock likely gets re-rated. Right now, the market is pricing them like a steady-as-she-goes utility. If they prove they can consistently generate 15%+ ROE through a tricky economic cycle, that valuation gap between them and the "premium" banks like RBC could start to close.
What Most Investors Get Wrong
The biggest misconception? That CIBC is "cheap" because it's "worse."
Historically, CIBC traded at a discount because of some high-profile missteps in the early 2000s and 2008. But the CIBC of 2026 is a different beast. Their Common Equity Tier 1 (CET1) ratio is sitting at a rock-solid 13.3%. They have plenty of "excess" capital. They're even buying back millions of their own shares.
Another thing people miss is the AI integration. They aren't just using chatbots. They’ve been embedding "agentic AI" into their back-office systems to drive down the efficiency ratio. In 2025, they managed to lower that ratio for the third year in a row. Basically, they are getting leaner and smarter about how they spend money.
Actionable Insights for Investors
If you’re looking at Canadian Imperial Bank of Commerce stock, don't just stare at the 52-week high of $93.68 and wait for a massive crash. The fundamentals suggest a steady climb rather than a bubble.
- Watch the BoC: If the Bank of Canada holds the line at 2.25%, the mortgage "shock" becomes a "thump." Manageable.
- Check the U.S. Earnings: When the next quarterly report drops in February 2026, skip the Canadian headlines and go straight to the U.S. Commercial Banking segment. That’s your growth indicator.
- Dividend Reinvestment: With the yield still sitting above 4%, using a DRIP (Dividend Reinvestment Plan) remains one of the most effective ways to play this stock. The compounding effect on a 10% dividend hike is massive over time.
Honestly, the "safe" play in Canadian banking has always been the big two, but the "value" play right now might just be the one everyone thinks they already know.
Next Steps for Your Portfolio:
Start by reviewing your current exposure to the Canadian financial sector. If you are underweight, look at CIBC’s P/E ratio relative to its Big Six peers. Currently, it often trades 1-2 points below the leaders, offering a "margin of safety" for income-focused investors. Confirm if your brokerage offers a discount on CIBC’s DRIP, as some Canadian banks offer a 2% to 3% discount on shares purchased through reinvested dividends.