Commonwealth Bank of Australia (CBA.AX): Will history repeat itself?

Research evidence excerpt

Commonwealth Bank of Australia (CBA.AX): Will history repeat itself?

Equity Research

24 July 2026 | 8:48AM AEST

Our take: CBA’s 2026 fiscal year has been defined by sharp share price swings and a Brendan Sproules

+61(3)9679-1276 |

recurring ‘sell the quarterly, buy the result’ trading pattern. This volatility reflects a brendan.sproules@gs.com

Goldman Sachs Australia Pty Ltd

priced for perfection environment where the market has shown little tolerance for

Rushil Vaghani

anything less than an earnings beat. While the 1Q26 and 3Q26 updates triggered +61(3)9679-1458 |

>5% sell-offs despite being operationally in-line, the 1H26 result drove a significant rushil.vaghani@gs.comGoldman Sachs Australia Pty Ltd

rally (+7%) as CBA capitalized on a stronger-than-expected economy with robust

business and housing credit growth. As the bank approaches its FY26 results in

August, revenue composition has shifted from pure lending volumes toward NIM

expansion (+1bpt in 4Q26), supported by widening unhedged deposit spreads and

increased yields from the replicating portfolio. Crucially, CBA is expected to deliver

positive operating jaws for the final three quarters of FY26, as underlying cost

growth moderates below 5% while revenue benefits from the full-quarter impact of

recent RBA rate hikes. Despite investor concerns regarding asset quality amid rising

energy prices and wage increases, households and businesses remain resilient, with

national insolvencies actually declining ~7% in 2H26 vs. the pcp. We anticipate that

the June quarter could conclude the year as CBA’s strongest period, potentially

acting as a catalyst for near-term share price momentum. However, we maintain a

Sell recommendation with a 12m target price of A$125.25, as the stock’s ~50%