Critical Review: Canadian Imperial Bank of Commerce (NYSE:CM) & Southern First Bancshares (NASDAQ:SFST)

Canadian Imperial Bank of Commerce (NYSE:CM) and Southern First Bancshares (NASDAQ:SFST) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, risk, institutional ownership and dividends.

Volatility & Risk

Canadian Imperial Bank of Commerce has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500. Comparatively, Southern First Bancshares has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500.

Earnings & Valuation

This table compares Canadian Imperial Bank of Commerce and Southern First Bancshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Canadian Imperial Bank of Commerce	$44.36 billion	2.25	$6.02 billion	$7.49	14.58
Southern First Bancshares	$132.64 million	4.25	$30.37 million	$4.67	12.77

Canadian Imperial Bank of Commerce has higher revenue and earnings than Southern First Bancshares. Southern First Bancshares is trading at a lower price-to-earnings ratio than Canadian Imperial Bank of Commerce, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Canadian Imperial Bank of Commerce and Southern First Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Canadian Imperial Bank of Commerce	16.09%	17.02%	0.87%
Southern First Bancshares	16.78%	10.18%	0.88%

Analyst Ratings

This is a summary of recent ratings and price targets for Canadian Imperial Bank of Commerce and Southern First Bancshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Canadian Imperial Bank of Commerce	0	5	4	1	2.60
Southern First Bancshares	0	1	2	0	2.67

Canadian Imperial Bank of Commerce currently has a consensus target price of $160.00, indicating a potential upside of 46.55%. Southern First Bancshares has a consensus target price of $64.00, indicating a potential upside of 7.29%. Given Canadian Imperial Bank of Commerce’s higher probable upside, equities research analysts plainly believe Canadian Imperial Bank of Commerce is more favorable than Southern First Bancshares.

Insider and Institutional Ownership

49.9% of Canadian Imperial Bank of Commerce shares are owned by institutional investors. Comparatively, 75.0% of Southern First Bancshares shares are owned by institutional investors. 6.9% of Southern First Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Canadian Imperial Bank of Commerce beats Southern First Bancshares on 9 of the 15 factors compared between the two stocks.

About Canadian Imperial Bank of Commerce

Canadian Imperial Bank of Commerce, a diversified financial institution, provides various financial products and services to personal, business, public sector, and institutional clients in Canada, the United States, and internationally. The company operates through Canadian Personal and Business Banking; Canadian Commercial Banking and Wealth Management; U.S. Commercial Banking and Wealth Management; Capital Markets and Direct Financial Services; and Corporate and Other segments. It offers checking, savings, and business accounts; mortgages; business, car, and other loans; lines of credit, student lines of credit, and agriculture loans; and small business financing and overdraft protection services. The company also provides investment and insurance services; credit cards; and ATMs, as well as mobile, online, and global money and wire transfer services. Canadian Imperial Bank of Commerce was founded in 1867 and is headquartered in Toronto, Canada.

About Southern First Bancshares

Southern First Bancshares, Inc. operates as the bank holding company for Southern First Bank that provides commercial, consumer, and mortgage loans to the general public in South Carolina, North Carolina, and Georgia. The company accepts various deposit products that include checking accounts, commercial checking accounts, and savings accounts, as well as other time deposits, including daily money market accounts and long-term certificates of deposit. Its loan portfolio comprises commercial real estate loans; construction real estate loans; commercial business loans for various lines of businesses, such as the manufacturing, service industry, and professional service areas; consumer real estate and home equity loans; and other consumer loans, including secured and unsecured installment loans and revolving lines of credit. In addition, the company provides other bank services, such as internet banking, cash management, safe deposit boxes, direct deposit, automatic drafts, bill payment, and mobile banking services. Southern First Bancshares, Inc. was incorporated in 1999 and is headquartered in Greenville, South Carolina.