CBA shares down 16% since peak amid core advantages 'slowly being eroded'

Commonwealth Bank of Australia (ASX: CBA) shares are $161.23 apiece, up 1.88% on Tuesday.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is 1.12% higher.

It's been a tale of two halves for CBA shares in 2025.

The highlight of the first half was the CBA share price reaching a historical high of $192 in late June.

In the second half came the fall, ending a sensational run that began all the way back in November 2023.

The net result: CBA shares are up 4.89% in the year to date compared to a 7.27% bump for the ASX 200.

Meanwhile in 2H CY25, the other three major ASX 200 bank shares have risen strongly and reached record highs last month.

The ANZ Group Holdings Ltd (ASX: ANZ) share price went to $38.93 and Westpac Banking Corp (ASX: WBC) shares reached $41.

The National Australia Bank Ltd (ASX: NAB) share price touched $45.25.

Blackwattle Large Cap Quality Fund portfolio managers Joe Koh and Elan Miller say CBA shares remain overvalued.

In their latest update, the fundies said:

While CBA is a very high-quality company, valuation has been extreme both from a price-to-earnings as well as price-to-book perspective.

The Fund still believes that the valuation of CBA remains stretched by both an historical and a relative basis.

The fundies also think CBA is losing some of its competitive edge.

We are also of the view that the core advantages CBA has historically enjoyed is slowly being eroded by increased competition.

Both Macquarie Group Ltd (ASX: MQG) and Westpac have been very aggressive at writing mortgage loans and the deposit base being eroded as savers look for better return on their deposits.

CBA has also seen their cost growth exceed revenue growth.

While the Large Cap Quality Fund owns CBA shares, the managers have implemented their mandate maximum underweight position.

This positioning helped the fund outperform its benchmark index, the S&P/ASX 200 Total Return Index, by 0.17% last month.

Our decision to be at our mandate maximum underweight in CBA allowed us to benefit from the underperformance of the financials and CBA in particular.

The S&P/ASX 200 Financials Index (ASX: XFJ) declined by 7.42% in November.

What's next for CBA shares?

Commonwealth Bank will release its 1H FY26 results and announce its interim dividend on 11 February.

The ex-dividend date for the interim dividend will be 18 February. The record date will be 19 February.

CBA will pay the dividend to investors on or about 30 March.

The post CBA shares down 16% since peak amid core advantages 'slowly being eroded' appeared first on The Motley Fool Australia.

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2025