CANADIAN IMPERIAL BANK OF COMMERCE $72 - Toronto symbol CM

CANADIAN IMPERIAL BANK OF COMMERCE $72 (Toronto symbol CM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 404.9 million; Market cap: $29.2 billion; Price-to-sales ratio: 2.3; Dividend yield: 5.0%; TSINetwork Rating: Above Average; www.cibc.com) is Canada’s fifth-largest bank, with total assets of $387.5 billion.

CIBC’s exposure to the five most troubled European countries was just $354 million when its fiscal 2012 second quarter ended on April 30, 2012. That’s down from $363 million on January 31, 2012 (the bank did not provide comparable figures for the end of fiscal 2011).

These amounts are small next to the $766 million, or $1.90 a share, that CIBC earned in its latest quarter. That’s up 6.1% from $722 million, or $1.80 a share, a year earlier. Without unusual items, earnings per share would have risen 9.3%, to $2.00 from $1.83. Revenue rose 2.3%, to $3.1 billion from $3.0 billion. Low interest rates continue to spur demand for loans. The bank also saw higher gains from the portfolio of securities it holds.

CIBC set aside $308 million to cover bad loans in the quarter, up 25.7% from $245 million a year earlier. That’s due to higher losses on personal loans in Canada, excluding credit cards, and extra provisions related to real estate loans in the U.S.

The stock trades at just 9.1 times the bank’s projected 2012 earnings of $7.94 a share. The $3.60 dividend yields 5.0%.

CIBC is a buy.

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