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Cadence Bank (CADE)
NYSE:CADE
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Cadence Bancorporation (CADE) AI Stock Analysis

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Cadence Bancorporation

(NYSE:CADE)

Rating:71Outperform
Price Target:
$38.00
▲(11.76%Upside)
Cadence Bank's overall stock score is primarily driven by strong financial performance and positive earnings call insights, including strategic growth initiatives. While the technical indicators suggest the stock may be overbought, the reasonable valuation and attractive dividend yield provide additional support.
Positive Factors
Earnings Accretion
CADE guided to ~12.6% EPS accretion from Industry, which has extremely low execution risk, making this a predictable benefit for the company.
M&A Benefits
The completion of the Industry Bancshares deal is expected to drive benefits from additional scale, cost savings, and increased liquidity, which should lead to an upside in the shares.
Negative Factors
Market Sentiment
There is apparent market distrust of M&A related accretion that could suppress the P/E multiple in the near-term, posing a risk to expected outperformance.
Regulatory Impact
The transaction will bring Cadence's CET1 ratio down from 12.4% to 11.0%.

Cadence Bancorporation (CADE) vs. SPDR S&P 500 ETF (SPY)

Cadence Bancorporation Business Overview & Revenue Model

Company DescriptionCadence Bank provides commercial banking and financial services in the United States. Its products and services include consumer banking, consumer loans, mortgages, home equity lines and loans, credit cards, commercial and business banking, treasury management, specialized and asset-based lending, commercial real estate, equipment financing, and correspondent banking services. The company's products and services also comprise small business administration lending, foreign exchange, wealth management, investment and trust, financial planning, retirement plan management, and personal and business insurance services. As of March 3, 2022, it operated approximately 400 branch locations across the South, Midwest, and Texas. The company was incorporated in 1876 and is headquartered in Tupelo, Mississippi.
How the Company Makes MoneyCadence Bank makes money primarily through the interest income generated from its lending activities, including personal loans, commercial loans, and mortgages. The bank also earns revenue from non-interest sources such as fees and service charges associated with its various banking services, wealth management, and insurance products. Additionally, Cadence Bank benefits from strategic partnerships and investments that enhance its financial offerings and market reach. Key factors contributing to its earnings include the bank's ability to maintain competitive interest rates, manage risk effectively, and expand its customer base through superior service and innovative financial solutions.

Cadence Bancorporation Earnings Call Summary

Earnings Call Date:Apr 21, 2025
(Q1-2025)
|
% Change Since: 24.31%|
Next Earnings Date:Jul 23, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook, with strong financial performance and strategic growth initiatives such as the acquisition of First Channel Bank. While there were some challenges, such as loan yield compression and increased loan provisions, the highlights, including significant net income growth, improved net interest margin, and stable credit results, outweighed the lowlights.
Q1-2025 Updates
Positive Updates
Regulatory Approval for Acquisition
Cadence Bank received all regulatory approvals to complete its acquisition of First Channel Bank in under 100 days, with plans to close on May 1.
Increase in GAAP Net Income
GAAP net income increased to $130.9 million, or $0.70 per share, and adjusted net income from continuing operations increased to $131.4 million, or $0.71 per share.
Improved Net Interest Margin
Net interest margin increased by 8 basis points in the quarter.
Loan Growth
First-quarter loan growth was nearly 4% on an annualized basis, with strong performance in Georgia, Florida, and Texas.
Stable Credit Results
Net charge-offs were 27 basis points annualized, and nonperforming loans declined 11% or $29 million in the first quarter.
Strong Capital Levels
Tangible book value increased to $22.30 per share, and CET1 capital ratio grew to 12.4%.
Stable Deposit Balances
Average deposits increased by $610 million, and core customer deposits maintained stability in balances and mix.
Strong Pretax Pre-Provision Net Revenue
Pretax pre-provision net revenue increased to $190 million, up over 3% from the prior quarter.
Negative Updates
Loan Yield Compression
Competition has driven loan yields down by around 25 basis points, particularly in merchant commercial real estate.
Impact of Interest Rate Cuts
Loan yields were down 9 basis points due to interest rate cuts, and total cost of deposits similarly declined by 9 basis points.
Slight Decline in Total Adjusted Revenue
Total adjusted revenue was down slightly by less than 0.5% compared to the prior quarter, primarily due to fewer days in the first quarter.
Increased Loan Provision
Loan provision increased slightly to $20 million, driven by a more conservative macroeconomic outlook.
Company Guidance
During the first quarter of fiscal year 2025, Cadence Bank demonstrated financial robustness with a GAAP net income increase to $130.9 million or $0.70 per share, and an adjusted net income from continuing operations rising to $131.4 million or $0.71 per share, with an improved ROA of 1.15%. The bank's net interest margin expanded by 8 basis points, thanks to strategic balance sheet management, while the adjusted efficiency ratio improved by over 100 basis points. Loan growth was nearly 4% on an annualized basis, driven by strong performance in Georgia, Florida, and Texas. Average deposits rose by $610 million, although period-end deposits remained flat due to typical first-quarter volatility. Credit performance was stable with net charge-offs at 27 basis points annualized, and the tangible book value increased to $22.30 per share, with CET1 capital levels growing to 12.4%. The bank expects continued stability and potential growth within its existing financial guidance, even as it prepares to integrate First Channel Bank following regulatory approval for its acquisition.

Cadence Bancorporation Financial Statement Overview

Summary
Cadence Bank shows strong financial performance with notable revenue growth and efficient cost management. Despite minor concerns about cash reserves, the company's financial health remains robust, supported by prudent leverage management and strong cash flow generation.
Income Statement
75
Positive
Cadence Bank demonstrated strong financial performance with notable growth in total revenue, increasing by approximately 40% from the previous year. The gross profit margin and net profit margin are robust, reflecting effective cost management and operational efficiency. However, EBIT and EBITDA margins show some variability, indicating potential fluctuations in operating expenses or other non-operating costs.
Balance Sheet
68
Positive
The balance sheet shows a solid equity base with a consistent equity ratio around 12%. The debt-to-equity ratio is low, signaling prudent leverage management, which is crucial in the banking sector. However, slight decreases in cash and short-term investments could indicate liquidity management challenges or strategic allocation changes.
Cash Flow
72
Positive
Operating cash flow is healthy and growing, with a positive free cash flow trajectory. The free cash flow to net income ratio indicates strong cash generation relative to accounting profits, although the operating cash flow to net income ratio has shown some fluctuations over the years.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.72B2.19B1.90B1.12B1.03B
Gross Profit1.72B1.16B1.69B910.55M938.43M
EBITDA878.76M237.70M638.25M297.84M330.92M
Net Income523.60M542.30M463.24M195.16M228.05M
Balance Sheet
Total Assets47.02B48.93B48.65B47.67B24.08B
Cash, Cash Equivalents and Short-Term Investments1.67B4.23B13.94B16.90B6.65B
Total Debt10.71M3.94B3.56B482.41M301.65M
Total Liabilities41.45B43.77B44.34B482.41M21.26B
Stockholders Equity5.57B5.17B4.31B5.25B2.82B
Cash Flow
Free Cash Flow776.59M457.62M828.55M1.10B170.63M
Operating Cash Flow856.66M563.51M923.05M1.17B226.54M
Investing Cash Flow-782.16M2.40B-1.71B-3.15B-2.43B
Financing Cash Flow-2.58B-715.44M1.49B2.86B2.29B

Cadence Bancorporation Technical Analysis

Technical Analysis Sentiment
Positive
Last Price34.00
Price Trends
50DMA
31.51
Positive
100DMA
30.49
Positive
200DMA
32.34
Positive
Market Momentum
MACD
1.21
Negative
RSI
57.82
Neutral
STOCH
64.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CADE, the sentiment is Positive. The current price of 34 is above the 20-day moving average (MA) of 32.87, above the 50-day MA of 31.51, and above the 200-day MA of 32.34, indicating a bullish trend. The MACD of 1.21 indicates Negative momentum. The RSI at 57.82 is Neutral, neither overbought nor oversold. The STOCH value of 64.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CADE.

Cadence Bancorporation Risk Analysis

Cadence Bancorporation disclosed 73 risk factors in its most recent earnings report. Cadence Bancorporation reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Cadence Bancorporation Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
$5.83B14.1010.63%2.71%6.67%8.50%
73
Outperform
$5.30B24.996.63%2.83%8.10%6.95%
71
Outperform
$6.49B12.449.90%3.10%19.04%
VLVLY
71
Outperform
$5.38B13.985.48%4.58%1.48%-18.84%
70
Outperform
$5.39B14.077.30%3.90%6.59%2.88%
68
Neutral
$5.32B23.0114.60%2.04%16.01%15.70%
68
Neutral
¥722.98B10.787.55%3.29%7.93%15.81%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CADE
Cadence Bancorporation
34.00
2.80
8.97%
FFIN
First Financial Bankshares
35.77
1.48
4.32%
GBCI
Glacier Bancorp
44.35
1.51
3.52%
HOMB
Home Bancshares
28.52
2.43
9.31%
UBSI
United Bankshares
36.57
0.39
1.08%
VLY
Valley National Bancorp
9.22
1.55
20.21%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 05, 2025