Stellar Bancorp to Merge with Prosperity Bancshares

Stellar Bancorp ( (STEL) ) has shared an announcement.

On January 27, 2026, Stellar Bancorp, Inc. agreed to merge with Prosperity Bancshares, Inc. in an all-stock and cash transaction under which Stellar will be combined into Prosperity, followed immediately by the merger of Stellar Bank into Prosperity Bank, leaving Prosperity and its banking subsidiary as the surviving entities. Stellar shareholders are to receive 0.3803 shares of Prosperity common stock plus $11.36 in cash for each Stellar share, with detailed treatment laid out for stock options, restricted stock and performance unit awards, and the combined organization’s governance structure expanded to add two Stellar-affiliated directors to the boards of Prosperity and Prosperity Bank. The deal, unanimously approved by both boards, is subject to customary shareholder, regulatory and stock exchange approvals as well as tax opinions, includes a $78 million termination fee payable by Stellar under certain conditions, and is supported by voting and director support agreements with Stellar directors who control about 8.8% of Stellar’s shares and have agreed to vote in favor of the transaction and observe post-closing non-solicitation and confidentiality restrictions.

The most recent analyst rating on (STEL) stock is a Buy with a $37.00 price target. To see the full list of analyst forecasts on Stellar Bancorp stock, see the STEL Stock Forecast page.

Spark’s Take on STEL Stock

According to Spark, TipRanks’ AI Analyst, STEL is a Outperform.

The score is driven primarily by solid financial strength (strong margins and conservative leverage) and supportive price trends (trading above key moving averages with positive MACD). These positives are tempered by weaker revenue growth and some profitability/cost pressures highlighted on the earnings call, while valuation appears reasonable but not particularly cheap. The announced merger adds a meaningful positive catalyst, albeit with execution/approval risk.

To see Spark’s full report on STEL stock, click here.

More about Stellar Bancorp

Stellar Bancorp, Inc. is a Texas-based bank holding company whose primary business is conducted through its wholly owned subsidiary, Stellar Bank. The company operates in the commercial and retail banking industry, offering a range of banking services to individuals and businesses in its regional markets, with a focus on traditional deposit-taking and lending activities through its branch network.

Average Trading Volume: 279,372

Technical Sentiment Signal: Buy

Current Market Cap: $1.67B

See more insights into STEL stock on TipRanks’ Stock Analysis page.