If you’ve spent any time looking at your CommSec app lately, you’ve probably noticed something a bit weird. Commonwealth Bank—the absolute titan of the Australian market—is acting like a jittery teenager. One day it’s flirting with record highs, and the next, it’s dragging the entire ASX 200 down with it. Honestly, if you're holding CBA shares ASX price in your portfolio, you're likely wondering if you're holding a golden goose or a ticking time bomb.
As of mid-January 2026, the price is hovering around the $154 mark. That sounds high, right? Especially when you consider that not too long ago, people were losing their minds because it crossed $100. But the raw number doesn't tell the whole story. The bank just came off a year where it actually underperformed the broader market for the first time since 2019. While the index was busy climbing nearly 7%, CBA was lagging behind, gasping for air with a modest 4.8% gain.
Why the CBA shares ASX price is stubbornly refusing to crash
Markets are supposed to be rational, but CBA investors are a different breed. There is a "valuation premium" attached to this bank that makes most analysts want to pull their hair out. Most of the big brokers, like Morgans and Morningstar, have been screaming "SELL" for months. Morgans even slapped a price target on it below $100.
Why the disconnect?
Basically, CBA is seen as a proxy for the Australian economy. If the economy is resilient, CBA is the fortress. In their latest updates for early 2026, the bank's leadership pointed out that despite the noise, 85% of their home loan customers are actually ahead on their repayments. That’s a massive buffer. Even with interest rates predicted to stay steady at 3.6% or even hike slightly in February 2026, the "Fortress CommBank" narrative keeps the price from falling off a cliff.
The Mortgage War is getting messy
You can’t talk about the CBA shares ASX price without talking about home loans. This is their bread and butter. Recently, the bank made a pretty aggressive move, hiking its fixed-rate mortgages by up to 0.70 percentage points. Some of those three-year rates are now north of 6%.
✨ Don't miss: Starting Pay for Target: What Most People Get Wrong
This is a double-edged sword.
- On one hand, it helps protect their profit margins (NIM).
- On the other, it makes them less competitive against the likes of ANZ and NAB, who are hungry for market share.
Investors are currently caught in this tug-of-war. They love the fat dividends—we’re talking about a $2.60 fully franked final dividend paid recently—but they hate seeing the bank lose its grip on the mortgage market.
The "Dividend Trap" vs. The Yield Reality
People buy CBA for the dividends. Period. If you look at the 2025 calendar year, the bank paid out $4.85 in total dividends per share. That’s a lot of cash landing in bank accounts. But with the share price sitting where it is, the yield is only around 3.1% to 3.4%.
Is that enough? Kinda.
When you add the franking credits, it looks better. But if the share price drops by 10% because the market decides it's finally too expensive, that 3% dividend feels like a very small consolation prize. Most of the "smart money" is looking at the Price-to-Earnings (P/E) ratio, which is currently sitting around 25x. Compare that to its peers who are trading significantly cheaper, and you start to see why the bears are so loud.
🔗 Read more: Why the Old Spice Deodorant Advert Still Wins Over a Decade Later
The AI Wildcard
One thing nobody was talking about two years ago that is now a major line item is AI. CBA recently appointed a Chief AI Officer and is dumping billions—yes, billions with a 'B'—into technology. They spent over $2.3 billion in 2025 alone on system modernization and AI.
They claim it's helping them stop scams (down 76% from peak losses) and automate back-office junk. If this actually leads to a lower "cost-to-income" ratio, it could justify the high share price. If it’s just another expensive tech project, it’s a massive drag on earnings.
What happens if the RBA moves in February?
The big talking point right now in the Sydney and Melbourne trading floors is the February 2026 RBA meeting. Both CBA’s own economists and the team at NAB have flagged a potential rate hike. This would be a shock to many who thought we were in for "higher for longer" or even cuts.
If a hike happens, the CBA shares ASX price will likely see a knee-jerk reaction. Usually, banks love higher rates because they can charge more for loans while being slow to raise deposit rates. But we’ve reached a tipping point where another hike might actually start breaking households. If bad debts start to rise, the bank has to set aside more "provisioning" cash, which eats into the profit available for dividends.
Currently, CBA has a buffer of about $2.6 billion for bad times. It’s a lot, but it’s not infinite.
💡 You might also like: Palantir Alex Karp Stock Sale: Why the CEO is Actually Selling Now
How to play the current price action
If you're looking at the charts, technical analysts like Matt Simpson have noted that CBA is "stubbornly refusing" to break below the $150 support level. It’s like there’s a floor made of nervous retail investors who refuse to let go.
- For the Bulls: You’re betting on the fact that CBA is simply "too big to fail" and that their dominance in digital banking will keep them ahead of the pack. You’re happy to collect the 3% yield and wait for the market to realize that the $190 highs of 2025 weren't a fluke.
- For the Bears: You’re looking at the 45% premium CBA holds over its peers and waiting for the "mean reversion." You think ANZ or Westpac offer better value because they aren't priced for perfection.
The reality is probably somewhere in the middle. CBA is a high-quality asset that is currently very expensive. It’s the "Louis Vuitton" of the ASX—you know you're overpaying for the brand, but the brand has a history of holding its value better than the cheap stuff.
Practical Steps for Investors
Don't just stare at the ticker symbol all day. If you are serious about managing your position, here is what you need to do:
Check the Dividend Reinvestment Plan (DRP) settings. CBA often offers a DRP where you can take your dividends in shares rather than cash. In 2025, the DRP price was around $168 in September and $149 in March. If you don't need the cash for groceries, this is the easiest way to compound your holding without paying brokerage fees.
Watch the Common Equity Tier 1 (CET1) ratio. This is a nerd stat, but it matters. As long as it’s above 12% (it’s currently around 12.3%), the bank has plenty of "spare" cash. This usually leads to share buybacks. They’ve already done a $1 billion buyback recently, which helps support the share price by reducing the number of shares on issue.
Monitor the First Half 2026 Results coming out on February 11, 2026. This is the big one. We will see the actual impact of those fixed-rate hikes and whether the net interest margin is expanding or shrinking. If the NIM (Net Interest Margin) drops below 2.0%, expect some selling pressure.
Lastly, stop comparing CBA to the US tech giants. It’s a bank. It’s a boring, mortgage-lending machine that happens to have a really good app. Treat it as a cornerstone of a portfolio, not a get-rich-quick scheme. The days of 20% annual growth are likely behind us for a while, but as a source of franked income in a volatile world, it still carries a lot of weight.