The Commonwealth Bank of Australia (ASX: CBA) share price has rocketed higher in recent months but is down 13.6% this year.
That means the ASX bank share is underperforming the S&P/ASX 200 Index (ASX: XJO) which has slumped 10.9% lower in 2020.
So, is the CBA share price a steal at $69.03 per share or should you hold off buying?
Is the CBA share price a cheap buy in 2020?
It's fair to say 2020 has been a pretty wild ride for CBA shareholders.
The Aussie bank share hit a new 52-week high of $91.05 per share in February before slumping to a 52-week low of $53.44 in the March's bear market.
Investors were spooked by the potential impacts of the coronavirus pandemic on the Aussie banks.
Many felt that the shutdown would strain businesses and households, leading to more home loan defaults and write-downs.
That hasn't turned out to be the case, partly due to better-than-expected public health outcomes and huge government stimulus.
So, where does that leave the CBA share price in terms of value?
At its current $69.03 per share, I don't think CBA is either cheap or expensive. Where the ASX bank share is headed from here I think really depends on how fast the economic recovery is.
If we see a 'V' or 'W' shaped recovery, the CBA share price could approach its 52-week high again by the end of the year.
If the economy bounces back strongly, that means lower unemployment and strong debt serviceability from businesses.
There are also a couple of measures which could translate to higher earnings for the Aussie bank.
For instance, CBA automatically cut its mortgages to minimum repayments in March. That helped ease the economic burden on many households but it may also prolong the repayment period, meaning more interest income in the long-run.
Foolish takeaway
I don't know where the CBA share price will go from its current level but I think I'm 50-50 on buying right now.
I would like to see evidence of economic recovery before investing in the ASX bank share. That could mean strong wage and employment figures or even the August earnings season.
Until then, I'll be a close observer to see if there are more buying opportunities in the current market.
