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Bank buildings tower over the corner of Bay Street and Adelaide streets in Toronto.
Bank buildings tower over the corner of Bay Street and Adelaide streets in Toronto.
(Gloria Nieto/The Globe and Mail)

Big Six bank shares are pricey, but investors aren’t crazy

Despite their wild run, shares of Canada’s biggest banks still aren’t astronomically expensive.

That’s the conclusion from CIBC World Markets analyst Rob Sedran, who crunched a slew of numbers to compare current valuations to historical trends, as well as to other sectors.

Right now, the Big Six banks trade at an average of 12.2 times CIBC’s fiscal 2014 earnings expectations. That means that if a bank generates $1 of earnings per share, its stock would trade for $12.20.