Value
5.9/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.1 |
| P/S | 7.1 |
| Fwd P/E | 8.6 |
| PEG | 2.9 |
| Analyst target | 3.0 |
- ▸Forward P/E: 13.2x
- ▸PEG: 4.27
CBSH · Why this verdict
Why Commerce Bancshares (CBSH) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.4/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The bank has beaten consensus earnings estimates in three of the last four quarters, including a 12.8% positive surprise in the most recent period, suggesting management consistently sets achievable expectations and delivers against them. Earnings | EPS surprises remain positive in the next two reported quarters, extending the pattern of disciplined execution. | →Stable |
| CounterOne quarter in the recent four was a miss, and the beat margin narrowed to 1.4% in the second-to-last quarter — suggesting the cushion may be compressing; a rate-sensitive revenue environment could close the gap entirely. | ||
Operating margins of 32% and a Piotroski financial health score of 8 out of 9 point to a well-managed balance sheet with above-peer earnings quality and strong fundamentals. Quality breakdown | Net margin holds above 28% and the Piotroski score stays at or above 7 for the next four quarters, confirming durable balance-sheet integrity. | →Stable |
| CounterThe quality notes do not detail deposit funding costs or loan-loss provisioning trends; any credit deterioration or spread compression in the loan book could quietly erode the margin picture without an immediate headline signal. | ||
Rising on-balance volume and a price above the 200-day moving average indicate sustained institutional buying interest and a price structure still broadly constructive. Momentum breakdown | On-balance volume continues to trend higher and the stock holds above its 200-day moving average for at least the next two quarters. | →Stable |
| CounterThe 200-day moving average slope is currently flat rather than rising, and a death-cross warning remains in a recovery phase rather than fully resolved — momentum could stall without a fresh fundamental catalyst. | ||
With only 0.3% remaining to the analyst price target and a reward-to-risk ratio of roughly 0.08-to-1, the current setup offers essentially no margin of safety for new capital at these levels. Warnings | A pullback of at least 10% from current levels would be required to restore a reward-to-risk ratio above 1.5-to-1 and reopen the entry case. | →Stable |
| CounterIf the upcoming earnings cycle produces another strong beat, analysts may revise price targets materially higher, shifting the reward geometry and re-opening the upside case without requiring a price retreat. | ||
A put/call ratio of 1.67 and implied volatility at 114%, with the stock trading above the options market's maximum pain level of $45, signal elevated hedging demand and potential near-term mean-reversion pressure. Risk breakdown | The put/call ratio declines below 1.0 and implied volatility normalizes below 60% over the next quarter as the stock either consolidates or pulls back toward the $45 area. | →Stable |
| CounterElevated put/call readings in a thinly traded regional bank can reflect mechanical hedging by large long holders rather than directional bearish speculation, which would overstate the signal's predictive power. | ||
The bank has beaten consensus earnings estimates in three of the last four quarters, including a 12.8% positive surprise in the most recent period, suggesting management consistently sets achievable expectations and delivers against them.
→StableEarnings
- Expectation
- EPS surprises remain positive in the next two reported quarters, extending the pattern of disciplined execution.
CounterOne quarter in the recent four was a miss, and the beat margin narrowed to 1.4% in the second-to-last quarter — suggesting the cushion may be compressing; a rate-sensitive revenue environment could close the gap entirely.
Operating margins of 32% and a Piotroski financial health score of 8 out of 9 point to a well-managed balance sheet with above-peer earnings quality and strong fundamentals.
→StableQuality breakdown
- Expectation
- Net margin holds above 28% and the Piotroski score stays at or above 7 for the next four quarters, confirming durable balance-sheet integrity.
CounterThe quality notes do not detail deposit funding costs or loan-loss provisioning trends; any credit deterioration or spread compression in the loan book could quietly erode the margin picture without an immediate headline signal.
Rising on-balance volume and a price above the 200-day moving average indicate sustained institutional buying interest and a price structure still broadly constructive.
→StableMomentum breakdown
- Expectation
- On-balance volume continues to trend higher and the stock holds above its 200-day moving average for at least the next two quarters.
CounterThe 200-day moving average slope is currently flat rather than rising, and a death-cross warning remains in a recovery phase rather than fully resolved — momentum could stall without a fresh fundamental catalyst.
With only 0.3% remaining to the analyst price target and a reward-to-risk ratio of roughly 0.08-to-1, the current setup offers essentially no margin of safety for new capital at these levels.
→StableWarnings
- Expectation
- A pullback of at least 10% from current levels would be required to restore a reward-to-risk ratio above 1.5-to-1 and reopen the entry case.
CounterIf the upcoming earnings cycle produces another strong beat, analysts may revise price targets materially higher, shifting the reward geometry and re-opening the upside case without requiring a price retreat.
A put/call ratio of 1.67 and implied volatility at 114%, with the stock trading above the options market's maximum pain level of $45, signal elevated hedging demand and potential near-term mean-reversion pressure.
→StableRisk breakdown
- Expectation
- The put/call ratio declines below 1.0 and implied volatility normalizes below 60% over the next quarter as the stock either consolidates or pulls back toward the $45 area.
CounterElevated put/call readings in a thinly traded regional bank can reflect mechanical hedging by large long holders rather than directional bearish speculation, which would overstate the signal's predictive power.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Commerce Bancshares is a high-quality regional bank with a strong earnings track record and institutional buying support, but the stock has essentially reached analyst consensus fair value, leaving a reward-to-risk ratio of approximately 0.08-to-1 that does not justify new capital at this level — patience for a meaningful pullback is the more prudent posture.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 5.0 |
| ROA | 1.1 |
| Gross margin | 0.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Moat | 5.9 |
| Piotroski F | 8.9 |
- ▸Strong margins: 32%
- ▸Strong Piotroski F-Score: 8/9
Growth
4.7/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.8 |
| EPS growth | 2.6 |
Momentum
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.0 |
| MACD | 10.0 |
| OBV | 4.5 |
| MA position | 8.0 |
| Volume | 2.6 |
- ▸Above 200-MA but MA slope flat
Sentiment
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.8 |
| Analyst rating | 5.0 |
| Price target | 5.3 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
5.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.8 |
| quality rank | 7.4 |
| growth rank | 6.2 |
- ▸Superior ROE vs peers
Technical
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.8 |
| support resistance | 1.6 |
| 52w position | 8.2 |
Risk (lower is worse)
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.6 |
| days to cover | 4.7 |
| volatility | 8.1 |
| put call | 0.0 |
| implied vol | 3.1 |
| beta | 9.5 |
| news risk | 5.5 |
- ▸Elevated put/call: 3.00
- ▸High IV: 61%
Catalyst
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 4.9 |
| dividend safety | 6.5 |
| news activity | 6.0 |
- ▸Strong earnings: 3B/1M
- ▸Earnings in 13 days
- ▸Dividend: 189.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (4)
- MOMENTUM:6.0>=5.5
- INSIDER:OK
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.0=NEGATIVE
Warning (2)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
- EARNINGS_PROXIMITY:13d<=14d (soft)
Reward-to-Risk
-1.02
Upside
-11.2%
Downside
11.0%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 68, MACD bullish
EdgeCatalyst-Driven — Earnings in 13d with 3/4 beat streak
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 5.4 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Momentum at 6.0) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.0=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.02 — supplementary context, not the trigger for this path.
The strongest dimensions are Momentum at 6.0, Value at 5.9, and Quality at 5.8; the weakest are Technical at 3.9, Growth at 4.7, and Insider at 5.0. The V9 engine flagged 1 failed gate with 2 warnings, producing an asymmetric reward-to-risk of -1.02 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Beat Discipline
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P2Quality Margins Financial Health
Trip ifNet margin compresses below 25% for 2 consecutive quarters from the current 32%.
- P3Momentum Volume Accumulation
Trip ifStock closes below its 200-day moving average for 10 consecutive trading sessions.
- P4Target Exhaustion Poor Rr
Trip ifAnalyst consensus price target rises above $62, restoring upside to take-profit greater than 10%.
- P5Options Bearish Skew Elevated Iv
Trip ifPut/call ratio falls below 0.8 and holds there for 3 consecutive weeks.