The Commonwealth Bank of Australia (ASX: CBA) share price is trading lower again on Thursday.
In morning trade, the banking giant's shares are down almost 1% to $98.28.
This means the CBA share price has now fallen 9% since the release of its first quarter update yesterday.
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Where next for the CBA share price?
With the CBA share price falling so heavily over the last two trading sessions, shareholders may be wondering where brokers believe it will go next.
Unfortunately for them, the broker community is overwhelmingly bearish on Australia's largest bank, save for one broker.
Below we summarise the views of 2 leading brokers with polar opposite opinions on the CBA share price.
The bearish view
Goldman Sachs remains very bearish. This morning the broker retained its sell rating and cut its price target down to $81.74. Based on the current CBA share price, this implies potential downside of approximately 17% for investors.
Goldman doesn't believe the bank's shares deserve to trade at such a premium to the reset of the big four.
It explained: "While CBA undoubtedly remains the preeminent retail banking franchise in Australia, today's trading update highlighted that even it is not immune from the profitability pressures that are currently particularly evident in mortgages (competition and mix).
"Furthermore, while CBA's commitment to investment is the right thing for the franchise in the medium term, it provides it with less flexibility to offset these revenue headwinds. Therefore, with our FY21-24E PPOP CAGR now 1% p.a, versus its peers at c. 5%, we struggle to justify the current 56% P/PPOP premium it trades on versus its peers (25% 15-year average). We therefore maintain our sell recommendation."
The bullish view
The team at Bell Potter remain positive on the CBA share price. This morning the broker retained its buy rating but trimmed its price target to $111.00. This implies potential upside of 13% before dividends.
While Bell Potter has reduced its earnings estimates and price target accordingly, it still sees enough value in the bank's shares to retain its buy rating.
The broker commented: "Given its lower quarterly performance, CBA's cash NPAT is reduced by 3% across the forecast horizon. This is mainly due to lower NII (-1%) and other income (-2%) but flat in total excluding the AHL divestment (above system growth that offset margin pressures and lower other income), slightly lower operating expenses (+1% based on lower remediation costs) and just a minor change in loan impairment expense in FY22 of -33% (i.e. a lower expense).
"The price target is however lowered by 6% to $111.00 (previously $118.00) after also considering added dividend and ROE risks. Based on a 12-month TSR of greater than 15%, CBA is still regarded as a buy."
