Commonwealth Bank of Australia (ASX: CBA) shares climbed nearly 8% higher throughout July.
So far in August, the ASX bank shares have been relatively flat. At the time of writing, the shares are $177.90 each.
Thanks to a strong start to the year, the bank's shares are up around 10% year to date and 2% higher than 12 months ago.
For context, the S&P/ASX 200 Index (ASX: XJO) is up around 3% year to date and roughly 4% higher than 12 months ago.
Now the question is, what's ahead for CBA shares over the next month?
Should investors buy CBA shares in August? Or is it time to sell up?
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Here's what the experts think
Brokers are pretty pessimistic about the outlook for CBA shares over the next 12 months.
Market Index data shows that all brokers have a sell rating on the banking giant's shares. The average $125.25 target price implies a potential 30% downside, at the time of writing.
Sentiment is similar on TradingView. Out of 16 analysts, 14 have a sell or strong sell rating on the shares. Another two rate the bank stock as a hold.
They all agree that a downside is ahead, however. The average $125.97 target price implies a potential 30% downside ahead. But some think the share price could fall by up to 50%, to just $90 a share.
The team at Macquarie recently said that while CBA's elevated valuation leaves it most exposed to the housing downturn, they expect its earnings to be the most resilient of the major banks.
The broker has an underperform rating on the stock and a $111 price target. But Macquarie said the bank might surprise on the upside with its second-half results. Although they expect its dividend to be increased by just 5 cents to $2.65, given the challenging macro outlook.
Morgans also reiterated its sell rating on CBA shares late last month and reduced its 12-month price target to $117.63. The broker said that stretched valuation metrics remain implied in the share price.
Up or down: What could influence CBA shares this month?
Reporting season begins this week, and the market has a close eye on CBA shares. CBA will release its full-year results and final dividend on 12 August. The final CBA dividend goes ex on 19 August, with payment due on or around 29 September.
Investors are eager to find out CBA's FY26 margin and the size of the final dividend. The result is expected to influence the direction of CBA shares over the next month, or longer.
The bank is forecast to pay a total dividend of $5.15 per share to shareholders in FY26.
So, are CBA shares a buy for passive income?
Potentially, yes.
CBA is huge in scale. The bank sits in second place on the ASX 200 in terms of market capitalisation.
CBA is primarily a cyclical stock, but it has strong defensive qualities. Its sheer scale often means investors generally consider it a safe haven when markets are unstable.
As a result, its operational performance and earnings are mostly strong and consistent, even when markets are weaker.
The latest update from the bank was for the three months to 31 March 2026. It reported statutory net profit of $2.6 billion, while cash net profit was $2.7 billion – this was up 4% year on year, but down 1% on the quarterly average of the FY26 first half.
CBA's huge scale and consistent operational performance mean the bank has maintained a long record of paying regular, fully-franked dividends every year, dating back to 1992.
As I mentioned above, the bank is forecast to pay a total dividend of $5.15 per share to shareholders in FY26. It is then expected to pay around $5.45 per share in FY27.
At the time of writing, this translates to a forward dividend yield of around 2.9% for FY26. For FY27, the forward dividend yield is about 3%.
