I can’t believe the momentum behind the Big 4 banks this year? CBA is up 40% in 12 months, reaching $134.25 today! Until today I’ve held onto every CBA share and said I wouldn’t sell because of the capital gains. The temptation is just too much at these levels. I’ve sold some CBA and NAB today and will offset some of the gains with losses on a few poor performers.

Reasons for reducing:

• PE 22.6x , the highest in 5 years
• Forward ROE 13.7%, OK, the best of the big 4, but not exceptional
• Dividend 3.5% fully franked, OK but not as good as a term deposit
• PB, 3 x book value, very high for a bank
• PEG 8.7, not compelling
• Analyst TP Consensus $93, can’t see the share price holding
• Annual return based on McNiven’s valuation is 7% per year (incl growth & dividends). There are solid growth stocks with higher ROI.

Held IRL (4.5%)