Will the CBA (ASX:CBA) share price climb another 23% in 2022?

What does 2022 hold in store for CBA shares?

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A woman in a bright yellow jumper looks happily at her yellow piggy bank representing bank dividends and in particular the CBA dividend

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Key points

  • The ASX 200 had a great 20221, but CBA shares did even better
  • This bank rose 23% last year, plus dividends and franking
  • But opinion is divided for what 2022 holds in store…

As most of us would remember rather fondly, 2021 was a pretty great year for ASX shares, all things considered. In the year just passed, the S&P/ASX 200 Index (ASX: XJO) managed to rise around 13% from top to bottom. Add in the benefits of dividends and franking and the returns get even better. But even the performance of the ASX 200 has to play second fiddle to the Commonwealth Bank of Australia (ASX: CBA) share price last year.

2021 was an incredible year for CBA shares. This ASX banking kingpin started the year at $82.11, but ended up at $101 a share by New Year’s Eve. That’s a very healthy rise of 23%. Factoring in CBA’s healthy dividends and franking, and we can add another 3-5% to those returns. As it stands today, CBA shares haven’t done too much in the new year. They’re currently asking $100.90 each at the time of writing, down 0.26%.

So now that we’ve well and truly kicked off 2022, many investors might be wondering if this company can pull another rabbit out of its hat, and give investors an additional 23% gain in 2022? Let’s see what the ASX’s expert investors reckon about that.

So one ASX broker who isn’t too keen on CBA shares for 2022 is investment bank, Goldman Sachs. Last month, Goldman rated CBA shares as a ‘sell’. It slapped a 12-month share price target of $82.57 on the bank, implying a potential downside of roughly 18.2% over the next year. Goldman simply thinks CBA shares trade too richly compared to the bank’s underlying fundamentals, and are predicting that CBA’s valuation premium could shrink to align more with the other ASX banks.

CBA shares: Buy, sell or hold?

But Goldman isn’t the only broker negative on CBA shares right now. As my Fool colleague James covered earlier this month, fellow broker Credit Suisse has also given CBA shares an ‘underperform’ rating. Credit Suisse isn’t as bearish as Goldman though, anticipating that CBA will fall to $92.50 a share over the next 12 months. That implies a potential downside of around 8.5%. Like Goldman though, this broker also has valuation concerns with CBA shares at their current level.

But it’s not all doom and gloom for CBA shareholders. As we also covered earlier this month, Bell Potter is a broker that is more fond of Commonwealth Bank today. Bell Potter still rated CBA as a ‘buy’, with a 12-month share price target of $111. If accurate, that would result in an upside of 9.9% over this year. This broker likes CBA due to its leadership position in the ASX banking industry and home loan markets, as well as its scale and branding power. It’s also anticipating hefty dividend rises from the bank across both FY2022 and FY23, with an expectation of $4.15 in dividends per share by FY23.

So there you have it, what a few expert ASX investors reckon lies in store for the CBA share price in 2022. Unfortunately, no one here seems to be anticipating another 23% year for CBA shares. But experts have been wrong before, so who knows what 2022 will end up looking like for CBA.

At the current Commonwealth Bank of Australia share price, this ASX bank share has a market capitalisation of $172.6 billion, with a price-to-earnings (P/E) ratio of 21.4 and a trailing dividend yield of 3.47%. 

Should you invest $1,000 in CBA right now?

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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