Commonwealth Bank of Australia (ASX: CBA) shares have jumped 7.99% higher in early afternoon trade on Wednesday. At the time of writing, the shares are trading at $171.42.
The uptick means the shares are now 6.4% higher for the year to date and 5.77% higher than this time last year. CBA shares are also just 10.4% below their all-time high of $191.40 recorded in June last year.
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What has pushed CBA shares higher today?
The banking giant reported its first-half results this morning. CBA posted a 5% increase in its statutory net profit after tax (NPAT), a 6% hike in its cash NPAT, and a 4% increase in its interim dividend, to $2.35 per share, fully franked.
It looks like investors are thrilled with the result, with many jumping at the chance to buy the stock, pushing the share price up higher as a result.
The latest update from the bank is great news for investors after dwindling confidence in the company's overvalued share price saw many shying away from the shares over the past few months.
CBA shares crashed nearly 30% in November following its Q1 FY26 results, which revealed a 2% year-on-year increase in unaudited cash NPAT and a 4% increase in operating costs.
Concerns that CBA's shares are significantly higher than those of other major Australian banks, and its high price-to-earnings (P/E) ratio continued to pile pressure on the share price through late-2025 and early-2026.
The Reserve Bank's decision to hike interest rates earlier this month also dented investor confidence in the banking giant.
What's the outlook for CBA shares this year?
Chief Executive Vittoria Shortt said, "While the geopolitical outlook remains uncertain, we are seeing more confidence in the economy, supported by lower interest rates and good export earnings in key sectors. This is evident in the uptick we've seen in business lending, with more lending growth across small business, commercial and rural this half than in the previous financial year."
"We remain well positioned to support our personal and business customers as they continue to tackle higher costs, navigate volatility or transition to growth."
While the bank is somewhat optimistic that confidence is returning to the market overall, the update hasn't reinvigorated analyst sentiment at present. We may see brokers reviewing their position on CBA shares in the coming days, although there won't necessarily be a material change either way.
At the moment, TradingView data shows that most analysts (14 out of 16) hold a sell or strong sell rating on CBA shares. The target prices vary wildly, but they all imply a downside from the current trading price.
The average target price is $123.54. This implies the shares could drop another 27.91% over the next 12 months, at the time of writing.
