Commonwealth Bank of Australia (ASX: CBA) shares have had a tough two week run.
In late afternoon trade on Tuesday, shares in the S&P/ASX 200 Index (ASX: XJO) bank stock were down 1.3%, changing hands for $162.84 apiece.
That marks the eighth consecutive day of losses for Australia's biggest bank stock. And it sees CBA shares down 9.5% since market close on 6 August, the last day the stock closed in the green.
That's certainly unwelcome news for longer-term shareholders.
But if you bought shares in the ASX 200 bank yesterday, and held them at market close, then you'll be getting the all-time high dividend payout management declared when CommBank released its full year FY 2026 results last Wednesday, 12 August.
CBA stock trades ex-dividend today. And at recent share price levels you'll be getting a significantly higher yield than if you'd bought the stock two weeks ago.
Among the more impressive figures from CBA's FY 2026 results, the big four bank reported a 6.2% year-on-year increase in operating income to $30.2 billion.
And with profits up as well, management declared a fully franked dividend of $2.70 per share. That represents a 3.9% increase from last year and marks a record passive income payout from the company.
At the recent share price of $162.84, the final dividend alone offers a yield of 1.7%. Eligible stockholders can expect to receive that payout on 29 September.
Of course, that rising dividend means little if CBA's share price continues to decline in the first half of FY 2027.
Which brings us back to our headline question.
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CBA shares: Buy, hold or sell?
Dolphin Partners Financial Services' Arthur Garipoli recently analysed the outlook for Australia's biggest bank stock (courtesy of The Bull).
"Cash net profit after tax of $10.982 billion in full year 2026 was up 7% on the prior corresponding period. The net interest margin of 2.05% was down 3 basis points," he noted of the bank's full year results.
As for his sell recommendation on CBA shares, Garipoli said:
The bank acknowledged growth is slowing in response to higher interest rates and inflation placing uneven pressure on household incomes and economic activity.
Home loan applications since the federal budget in May fell 15%.
And despite the recent share price decline, Garipoli still has concerns over CBA's valuation.
He concluded:
CBA is a high-quality bank, but an uncertain Australian economy leaves a challenging outlook at this point. We believe the bank is trading on a stretched valuation, so it may be prudent to lock in some profits.
CBA stock trades on a price to earnings (P/E) ratio of around 26 times, the highest among the big four ASX 200 bank stocks.
