Is CBA Still A Buy In 2025?

Will CBA Continue to Defy Gravity?

Commonwealth Bank (ASX: CBA) has been the standout performer on the ASX 200 in 2025 so far – but can it continue to defy valuations?

According to Henry Jennings, “The banks have been the massive driver of performance this year,” with CBA leading the charge. While gold stocks have done well, major resource names like BHP, Rio Tinto, and Fortescue have underperformed. “It is about the banks,” he says.

But the big question now is whether CBA can sustain its momentum. “CBA is what I call the ‘Rolex stock’ – the stock that defies valuations,” Henry explains.

Why Has CBA Outperformed?

Recent research from Macquarie suggests Commonwealth Bank is “probably one of the only ones showing any real systemic growth.” That growth, combined with a dominant deposit base and stronger margins, has helped justify its valuation premium — at least so far.

One key advantage? Its ability to bypass mortgage brokers. “That enables them to kind of bypass the mortgage brokers,” Henry says. “That’s one of the reasons why their net interest margin has stayed so high.”

Could AI Be the Next Catalyst?

Henry also highlights the role of artificial intelligence (AI) in banking. From improving customer experience to streamlining loan processes, the Big Four banks are all exploring how AI can enhance their business, and CBA may have a head start.

What’s Next for the Big Four?

While CBA remains dominant, Henry warns that its best performance may already be behind it. “It’s unlikely we’re going to see a major plunge,” he says, “but it may go back to being more of a market performer.”

Other banks could close the gap. “Maybe ANZ and Westpac will play some catch-up,” he says. “NAB has already done some of that.”

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