Commerce Bancshares (CBSH) Stock Forecast & Price Target

Commerce Bancshares is viewed positively because it combines defensiveness with improving earnings power, supported by a low loan-to-deposit ratio of 74%, robust capital at 11.4% TCE, and peer-leading ROA of 1.8%, while also delivering stronger-than-peer fee income. The company’s core margin outlook is constructive, with NIM rising 18 bps to 3.77% and management benefiting from a late-2Q securities repositioning that lifted investment securities yields by 40 bps to 3.37% and should reduce volatility after the entire TIPs portfolio was sold. Even though balance-sheet growth is expected to remain in the low-single-digit range and EPS growth may lag peers through 2027, lower deposit and credit costs, strong pipelines, stable deposit costs, and higher share repurchases support further estimate increases to $4.28 for 2026 and $4.40 for 2027.

Commerce Bancshares is facing a negative outlook because, despite pockets of strength in net interest income and fees, its core earnings power still appears likely to lag peers, with 2026 EPS expected to be flattish and 2027 only mid- to high-single-digit growth versus peers at 10%+ in each year. The company’s balance sheet trends are also mixed, as average loans rose 3.5% annualized and purchase loans grew 7% annualized, but average deposits declined 2.0% annualized and period-end deposits fell 7% annualized, underscoring funding pressure even as core NIM improved to 3.59% and core NII increased to $311.3 million. On top of that, the stock already trades at a premium valuation of 13.1x 2027E EPS and 2.2x TBVPS, which leaves limited room for disappointment given regulatory, credit, competition, and interest-rate risks that could constrain growth and earnings.