CBA Share Price Doing Better than Big 4 Peers: Which Bank Stock is Best?

At time of writing, the share prices of the Big Four are all up. The CBA share price is the biggest winner with a 1.67% gain.

The Big Four includes competitors Westpac Banking Corporation [ASX:WBC]National Australia Bank Ltd [ASX:NAB], ANZ Banking Group [ASX:ANZ] and of course the biggest of the bunch Commonwealth Bank of Australia [ASX:CBA].

You can see how the Big Four have performed below, along with dividend yield and net margin:

CBA share price


Today we ask, which Big Four bank stock is best? The short answer is none. But there are reasons to believe that the CBA share price may not lose as much ground as the other Big Four bank stocks.

CBA share price up today, only stock to escape the last 30 days with a gain

With trade optimism driving the ASX higher today, it is little surprise that blue-chip CBA was on the receiving end of the change in sentiment.

But as you can see in the table above, the CBA share price is the only one to clock a 30 day gain.


Free Report: ‘Why Your Bank Dividends Could Be Under Threat’

CBA’s net margin is better and reflects economies of scale

CBA has the highest price to earnings ratio as it has held up in the best in the charts recently.

Yield hungry investors have potentially propped up its share price.

But CBA has the lowest dividend yield — something which may prompt misguided retail bargain hunters to turn to its Big Four competitors.

It also has the best trailing net margin, indicating that it turns a bigger portion of its revenue into profit.

A lot of this comes down to the fact that it is the biggest fish in a small pond — only three major competitors.

Banks centralise information about transactions, so it makes sense that you get more bang for your buck the bigger you get.

We have previously flagged that the CBA share price seems unable to break through resistance at $82 dollars.

Since we made this observation, it has bumped up against it on two more occasions.

Enthusiasm about a conclusion to the US–China trade war could take it (briefly) past the $82 mark in the coming weeks and months.

Big Four dividend yield is trailing so be wary

People sometimes see the headline dividend yield and get excited.

But this is backward looking/trailing so it pays to be wary.

Just because the Big Four have traditionally had great dividends is no guarantee they will continue to do so.

We take a more in-depth look at the factors influencing the likelihood of further dividend cuts here, and three companies we think are most likely to benefit from a shift in financial services here.


Lachlann Tierney,

For Money Morning

PS: Our publication Money Morning is a fantastic place to start on your investment journey. We talk about the big trends driving the most innovative stocks on the ASX, in particular fintech stocks. Learn all about it here.

Lachlann Tierney is an Analyst for Money Morning and has been investing for nearly a decade. With a Masters of Science from the London School of Economics, he brings a sound understanding of global markets to his writing. Lachlann is interested in emerging technologies, energy solutions and helping people invest their money wisely. Recently he has been working with Ryan Dinse. Lachlann is involved in two publications:

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