Commerce Bancshares: In Tougher Times, The 'Platinum Tortoise' Outperforms

Stephen Simpson profile picture
Stephen Simpson
18.34K Followers

Summary

  • Commerce Bancshares did well in the third quarter on a core basis, with double-digit year-over-year core pre-provision profit growth driven by strong spread income.
  • Credit quality remains strong despite higher provisioning, but loan growth was more "okay" than good, and weaker earning asset growth is a modest concern.
  • Commerce's strong core deposit franchise and proven conservative management are positives in tough times, but the premium is a concern when bank stocks rally again.

Brush Creek in Kansas City, Missouri

Cesar Aleman/iStock via Getty Images

I've criticized the premium multiple of Commerce Bancshares (NASDAQ:CBSH) in the past, but in tougher times like these, the Street certainly seems to appreciate the quality core deposits and demonstrated underwriting competence of this conservatively-run

This article was written by

Stephen Simpson profile picture
18.34K Followers
Stephen Simpson is a freelance financial writer and investor. Spent close to 15 years on the Street (sell-side, buy-side, equities, bonds); now a semi-retired raccoon rancher. That last part isn't entirely true. Probably.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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