Sunday, April 12, 2015

Analysis of Coba 2015


Coba, A German bank

Company: Commerzbank

ISIN DE000CBK1001 | WKN CBK100

Business: A German bank. Their five pillars are: Private Customers (accounts, credits, wealth management etc.), Mittelstandbank (medium sized companies as well as institutions), Central & Easter Europe (mBank big in Poland), Corporate & Markets (Corporate finance, equity, currencies etc.) and finally Non-Core Assets (Real Estate and ship-building). 

Active: Claim presence in 50 countries. Europe with Germany and Poland are biggest.

P/E: 56.9

Here you can find the previous analysis of Commerzbank 2014

contrarian values of P/E, P/B, ROE as well as dividend for Coba

The P/E for Coba is far too high with 56.9 but the P/B is excellent with 0.6. Still the overall score gives a no go from Graham. Earnings to sales are awful with 2% and the ROE is equally silly with 1% one! Bad, bad, bad. The book to debt ratio like for any bank is low with 0.05.
In the last five years they have had a yearly revenue growth of -7.3% which is horrible. Simply horrible! We then end up with a motivated P/E of 8 to 10 which means that Coba is today highly overvalued on the market.
They of course pay no dividend since they need that to pay their huge board and managers which at least they themselves find more important. I don´t.

Conclusion: Graham says no and based on what I see here the only reason to invest would be due to the P/B value which is also the reason for why I invested in the first place now many years ago. I would not recommend anyone to buy into Commerzbank and as a shareholder already I will remain with my investment until I see a more appropriate P/B value. I am also not likely to increase my holding at the moment.

If this analysis is outdated then you can request a new one.

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