Cullen/Frost Bankers (CFR) AI Stock Analysis

• Market Cap: $8.28B
• Dividend Yield: 3.05%
• Average Volume (3M): 457.90K
• Price to Earnings (P/E): 13.3
• Beta (1Y): 0.85
• Revenue Growth: 2.85%
• EPS Growth: 20.57%
• Country: US
• Employees: 5,854
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 2.67
• Shares Outstanding: 63,941,100
• 10 Day Avg. Volume: 535,195
• 30 Day Avg. Volume: 457,900
• PEG Ratio: -5.86
• Price to Book (P/B): 2.21
• Price to Sales (P/S): 3.02
• P/FCF Ratio: 10.00
• Enterprise Value/Market Cap: 1.54
• Enterprise Value/Revenue: 4.41
• Enterprise Value/Gross Profit: 5.97
• Enterprise Value/Ebitda: 15.12
• 1Y Price Target: $138.50
• Price Target Upside: 7.11% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 8
• EPS Forecast (FY): 9.83
• Revenue Forecast (FY): $2.27B

• Rating: 77 Outperform
• Price Target: $141.00 ▲(9.04% Upside)

Cullen/Frost Bankers receives a strong overall score driven by its robust financial performance and positive earnings call outcomes. The company's attractive valuation further supports the score, although technical indicators suggest a neutral market sentiment. The absence of significant corporate events means the focus remains on financial and operational metrics.

Positive Factors

Revenue Growth

The strong year-over-year earnings growth indicates robust revenue generation and effective business operations, supporting long-term financial health.

Expansion Strategy

Successful expansion efforts, particularly in Houston, enhance market presence and provide a foundation for sustained growth and profitability.

Improved Credit Quality

The reduction in nonperforming assets reflects strong credit management, reducing risk and enhancing financial stability over the long term.

Negative Factors

Rising Expenses

Increasing expenses, particularly in compensation and technology, could pressure margins and affect profitability if not managed effectively.

Commercial Real Estate Paydowns

Limited growth in commercial real estate due to paydowns suggests potential challenges in maintaining growth in this segment, impacting future revenue.

Competitive Market Pressures

Rising competition in loan pricing could compress margins and challenge market share, necessitating strategic adjustments to maintain competitiveness.

Cullen/Frost Bankers Business Overview & Revenue Model

Company Description

Cullen/Frost Bankers, Inc. operates as the bank holding company for Frost Bank that offers commercial and consumer banking services in Texas. It operates in two segments, Banking and Frost Wealth Advisors. The company offers commercial banking services to corporations and other business clients, including financing for industrial and commercial properties, interim construction related to industrial and commercial properties, equipment, inventories and accounts receivables, and acquisitions; commercial leasing; and treasury management services. It also provides consumer banking services, such as checking accounts, savings programs, automated-teller machines (ATMs), overdraft facilities, installment and real estate loans, home equity loans and lines of credit, drive-in and night deposit services, safe deposit facilities, and brokerage services. In addition, the company offers international banking services comprising deposits, loans, letters of credit, foreign collections, funds, and foreign exchange services. Further, it acts as a correspondent for approximately 171 financial institutions; offers trust, investment, agency, and custodial services for individual and corporate clients; provides capital market services that include sales and trading, new issue underwriting, money market trading, advisory, and securities safekeeping and clearance; and supports international business activities. Additionally, the company offers insurance and securities brokerage services; and holds securities for investment purposes, as well as investment management services to Frost-managed mutual funds, institutions, and individuals. It operates approximately 157 financial centers and 1,650 ATMs. The company serves energy, manufacturing, services, construction, retail, telecommunications, healthcare, military, and transportation industries. Cullen/Frost Bankers, Inc. was founded in 1868 and is headquartered in San Antonio, Texas.

How the Company Makes Money

Cullen/Frost Bankers generates revenue through various streams primarily focused on interest income and non-interest income. The bulk of its revenue comes from net interest income, which is derived from the interest earned on loans and securities, minus the interest paid on deposits and borrowings. Key revenue streams include commercial loans, residential mortgages, and consumer loans, which contribute significantly to interest income. Additionally, the company earns non-interest income from service fees, investment advisory services, and wealth management solutions. Strategic partnerships with local businesses and community organizations enhance its customer base and drive growth. The company's strong focus on the Texas economy, combined with its diversified product offerings, supports its financial performance and overall profitability.

Cullen/Frost Bankers Financial Statement Overview

Summary

Cullen/Frost Bankers exhibits strong financial performance with robust revenue and profit growth, supported by efficient cost management and solid margins. The balance sheet is stable, with a balanced leverage approach and strong return on equity. Cash flow generation is improving, though there are areas for enhancement in cash conversion efficiency. Overall, the company is well-positioned in its industry, but should remain vigilant about managing debt levels and cash flow stability.

Income Statement

Cullen/Frost Bankers has demonstrated strong revenue growth, particularly in the TTM period with a 41.1% increase. Gross profit margins are robust, consistently above 70%, indicating efficient cost management. Net profit margins are healthy, averaging around 21% in recent periods. The EBIT and EBITDA margins are also solid, reflecting strong operational performance. However, the volatility in revenue growth rates over the years suggests potential fluctuations in market conditions.

Balance Sheet

The company's balance sheet shows a moderate debt-to-equity ratio of approximately 1.11 in the TTM period, indicating a balanced approach to leveraging. Return on equity is strong at around 14.9%, showcasing effective use of shareholder funds. The equity ratio is stable, reflecting a solid capital structure. However, the increase in total debt over recent years could pose a risk if not managed carefully.

Cash Flow

Cullen/Frost Bankers has shown positive free cash flow growth in the TTM period, with a 15.5% increase, indicating improved cash generation capabilities. The operating cash flow to net income ratio is low, suggesting potential challenges in converting income into cash. The free cash flow to net income ratio is moderate, reflecting a reasonable level of cash profitability. The fluctuations in cash flow metrics highlight the need for careful cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.90B	2.85B	2.65B	1.88B	1.40B	1.49B
Gross Profit	2.14B	2.00B	1.94B	1.69B	1.37B	1.20B
EBITDA	845.11M	778.78M	788.82M	740.17M	558.83M	415.69M
Net Income	637.16M	582.54M	597.97M	579.15M	443.08M	331.15M
Balance Sheet
Total Assets	52.53B	52.52B	50.85B	52.89B	50.88B	42.39B
Cash, Cash Equivalents and Short-Term Investments	18.62B	25.26B	25.18B	30.06B	30.47B	20.73B
Total Debt	4.82B	4.59B	4.36B	4.93B	2.99B	2.35B
Total Liabilities	48.07B	48.62B	47.13B	49.76B	46.44B	38.10B
Stockholders Equity	4.46B	3.90B	3.72B	3.14B	4.44B	4.29B
Cash Flow
Free Cash Flow	119.90M	861.76M	320.21M	620.08M	582.44M	428.82M
Operating Cash Flow	157.55M	989.53M	478.85M	722.58M	648.29M	524.24M
Investing Cash Flow	-2.45B	-180.88M	-942.75M	-8.28B	-2.53B	-1.63B
Financing Cash Flow	1.03B	738.33M	-2.88B	3.00B	8.17B	7.61B

Cullen/Frost Bankers Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 129.31
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CFR, the sentiment is Positive. The current price of 129.31 is above the 20-day moving average (MA) of 127.23, above the 50-day MA of 124.37, and above the 200-day MA of 123.96, indicating a bullish trend. The MACD of 1.57 indicates Negative momentum. The RSI at 61.14 is Neutral, neither overbought nor oversold. The STOCH value of 53.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CFR.

Cullen/Frost Bankers Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ONB	80 Outperform	$9.10B	13.54	8.26%	2.43%	20.72%	3.63%
CFR	77 Outperform	$8.28B	13.31	14.68%	3.05%	2.85%	20.57%
BPOP	77 Outperform	$8.42B	11.10	13.05%	2.31%	5.87%	53.36%
ZION	74 Outperform	$8.89B	10.60	12.71%	2.97%	0.12%	27.30%
CBSH	73 Outperform	$7.37B	13.35	15.45%	1.97%	12.63%	14.25%
CMA	71 Outperform	$11.35B	16.93	9.64%	3.20%	-7.07%	31.09%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Cullen/Frost Bankers Corporate Events

Cullen/Frost Bankers Releases Investor Presentation

Cullen/Frost has released an investor presentation dated June 30, 2025, available on its website. The presentation includes forward-looking statements and is accompanied by a Current Report on Form 8-K, highlighting potential risks and cautionary factors that could impact the company’s future performance.