Commerzbank's New Strategy and Dividend Offensive Push Stock Further Beyond UniCredit's Offer

Commerzbank stock climbs 18% above UniCredit's all-stock bid, with investors wagering on a sweeter deal or the bank's ambitious 'Momentum 2030' plan.

The widening gap between Commerzbank's market price and UniCredit's exchange offer is becoming a defining feature of Europe's most hostile bank takeover battle. On Thursday, the Frankfurt-based lender's shares traded at €36.79, representing a premium of roughly 18% over the €31.07-a-share valuation implied by the Italian bank's all-stock bid. The spread signals that investors either expect a sweeter deal or are betting on the standalone plan.

Market bets are increasingly backed by hard numbers. Commerzbank's management has unveiled a sweeping strategic overhaul under the "Momentum 2030" banner, targeting a net return on equity of 21% by the end of the decade — a sharp jump from the 8.7% delivered in 2025. The cost-income ratio is slated to fall to 43%, driven by an additional 3,000 job cuts on top of the 3,900 already announced. At the same time, the bank plans to invest €600 million in artificial intelligence initiatives between 2026 and 2030, aiming to boost efficiency beyond headcount reduction.

Shareholders will get a taste of the new discipline at the annual general meeting on May 20. The board has proposed a dividend of €1.10 per share for the 2025 financial year, a substantial increase from the €0.65 paid a year earlier. The ex-dividend date is set for May 21, with payment on May 26. In addition, a fresh authorization for share buybacks of up to 10% of share capital will be put to a vote. If approved, the move would strengthen the bank's ability to return capital and build a further hurdle for UniCredit.

Analysts are taking note. JPMorgan raised its price target on Thursday from €36 to €37, maintaining a "Neutral" rating. The upgrade reflects strong first-quarter numbers and confidence in the 2030 strategy, but the house is holding back on a buy call due to the uncertain takeover scenario. Deutsche Bank Research is more bullish, with a €40 target, while Barclays recently lifted its goal to €42. All three forecasts imply further upside from current levels.

Despite the strategic conviction, technical indicators flash a warning. The relative strength index stands at 83 — deep into overbought territory — and the stock is trading roughly 10% above its 50-day moving average. Such stretched readings often precede short-term corrections, though they rarely derail a story driven by deal dynamics and fundamental improvements.

UniCredit's offer, launched on May 5, consists of 0.485 of its own shares for each Commerzbank share. At the time of announcement, that equated to roughly €31.07. The acceptance period runs until June 16. With the target stock comfortably above that level, the ball is now in Andrea Orcel's court: sweeten the terms, or risk a low take-up rate that would weaken the credibility of the bid.

Commerzbank has rejected the proposal as undervaluing its prospects and points to execution risks. The Italian bank had previously estimated that a combination could eliminate around 7,000 jobs in Germany. For now, the market appears to be siding with the defence, rewarding the Frankfurt institution's ambition to go it alone.