Topic: How To Invest

The Successful Investor Hotline – Thursday, June 30, 2016

Article Excerpt

PLEASE NOTE: Our next Hotline will go out on Friday, July 8, 2016. CANADIAN IMPERIAL BANK OF COMMERCE, $97.04, Toronto symbol CM, has agreed to buy Chicago-based PrivateBancorp Inc. (Nasdaq symbol PVTB). PrivateBancorp mainly lends to small and mid-sized businesses. It also provides wealth management services. In addition to Chicago, it operates in 11 other U.S. markets. CIBC will pay $3.8 billion U.S. (40% in cash and 60% in stock) for PrivateBancorp. To put that in context, the bank’s market cap (the total value of all outstanding shares) is $37.3 billion (Canadian). The purchase helps reduce the bank’s exposure to Canada, which accounts for over 80% of its earnings. CIBC can also cross-sell other services to PrivateBancorp’s high-quality clientele. If PrivateBancorp’s shareholders and regulators approve, the bank expects to complete the purchase in the first quarter of 2017. That operation should begin to lift CIBC’s earnings in the third year following the acquisition. OUR RECOMMENDATION: CIBC is a buy. CIBC recent coverage Hotline for May 27, 2016 Hotline…