Cullen/Frost Bankers (CFR) AI Stock Analysis

• Market Cap: $9.12B
• Dividend Yield: 3.05%
• Average Volume (3M): 517.74K
• Price to Earnings (P/E): 14.6
• Beta (1Y): 0.89
• Revenue Growth: 2.85%
• EPS Growth: 20.57%
• Country: US
• Employees: 5,854
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 2.56
• Shares Outstanding: 63,201,794
• 10 Day Avg. Volume: 434,792
• 30 Day Avg. Volume: 517,742
• PEG Ratio: 0.97
• Price to Book (P/B): 1.77
• Price to Sales (P/S): 2.78
• P/FCF Ratio: 63.70
• Enterprise Value/Market Cap: 0.53
• Enterprise Value/Revenue: 1.67
• Enterprise Value/Gross Profit: 2.22
• Enterprise Value/Ebitda: 5.67
• 1Y Price Target: $150.40
• Price Target Upside: 5.82% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): 10.24
• Revenue Forecast (FY): $2.38B

• Rating: 69 Neutral
• Price Target: $157.00 ▲(10.46% Upside)
• Action: Downgraded Date: 02/06/26
• Date: Action: Downgraded 02/06/26

The score is driven by solid underlying financial strength and a favorable technical uptrend. Constructive guidance and operating momentum are balanced by asset-quality migration, unrealized AFS losses, and expense growth concerns, while valuation and dividend support an above-average but not top-tier rating.

Positive Factors

Organic Expansion Traction

The bank's disciplined organic branch roll‑out has produced sizable, sticky retail deposits and loan originations, adding ~69,000 households and material balances. Durable physical presence and new relationships improve funding stability, cross-sell, and long-term NII diversification as markets mature.

Consistent Profitability / ROE

Sustained mid‑to‑high single digit to double‑digit ROE signals enduring franchise profitability and attractive capital returns. Persistent profitability supports internal capital generation, cushions credit shocks, funds growth investments, and underpins ability to sustain dividends and strategic initiatives over cycles.

Improved Capital Position

A stronger reported capital base and lower reported debt enhance financial flexibility and shock absorption. Improved leverage gives management room to lend, invest, and absorb marks without immediate capital raises, supporting the bank's expansion and underwriting activities over the medium term.

Negative Factors

Asset‑Quality Migration (Multifamily)

Concentrated deterioration in multifamily criticized loans raises the risk of higher reserves and charge‑offs if resolutions slow. Persistent asset‑quality pressure can reduce loan yields, increase funding costs for risk mitigation, and constrain capital deployment, weighing on earnings durability over quarters.

Large Unrealized AFS Loss

A sizable mark‑to‑market loss reflects duration and rate exposure in the securities book. If rates remain elevated or the portfolio is monetized, losses could hit capital or NII. This structural interest‑rate sensitivity reduces balance‑sheet optionality and heightens risk of realized impairment in stress scenarios.

Expense Growth Outpacing Revenue

Persistent expense growth above revenue expansion compresses operating leverage and margins. Over time, higher structural costs without commensurate revenue gains erode ROE and limit capacity to invest in growth or absorb credit losses, forcing future efficiency actions or slower expansion.

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

Solid profitability and consistently strong ROE underpin results, and free cash flow has remained positive. Offsetting this, 2025 showed a sharp revenue decline and operating/free-cash-flow volatility, creating near-term uncertainty despite the improved reported leverage profile.

Income Statement

Profitability remains solid with consistently strong net margins (roughly low-20% to low-30%) and healthy operating profitability across 2020–2025. Net income has been relatively stable-to-up over time, but the top line has been volatile: strong growth in 2022–2024 followed by a sharp revenue decline in 2025 (annual revenue down ~23% year over year). Overall, earnings power looks good, but the 2025 revenue step-down is a notable near-term concern.

Balance Sheet

The balance sheet shows improved capital positioning in 2025, with equity rising and reported total debt dropping to zero from prior years (which previously ran around 0.5x–1.6x equity). Returns on equity have been strong and consistent (roughly ~10%–18%), indicating good profitability on shareholder capital. The main watch item is the large year-to-year swing in reported debt, which creates uncertainty around the durability of the leverage improvement without more detail.

Cash Flow

Cash generation has generally been positive, with free cash flow positive each year and typically covering a large portion of net income (about ~0.67x–0.90x in 2020–2024; 1.0x in 2025). However, operating and free cash flow have been notably volatile (a sharp drop in 2023, a rebound in 2024, and much lower operating cash flow again in 2025). The variability reduces confidence in near-term cash consistency despite the long-run ability to generate cash.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.92B	2.85B	2.65B	1.88B	1.40B
Gross Profit	2.19B	2.00B	1.94B	1.69B	1.37B
EBITDA	859.49M	778.78M	788.82M	740.17M	558.83M
Net Income	648.56M	582.54M	597.97M	579.15M	443.08M
Balance Sheet
Total Assets	53.04B	52.52B	50.85B	52.89B	50.88B
Cash, Cash Equivalents and Short-Term Investments	9.98B	25.26B	25.18B	30.06B	30.47B
Total Debt	4.77B	4.59B	4.36B	4.93B	2.99B
Total Liabilities	48.47B	48.62B	47.13B	49.76B	46.44B
Stockholders Equity	4.57B	3.90B	3.72B	3.14B	4.44B
Cash Flow
Free Cash Flow	127.33M	861.76M	320.21M	620.08M	582.44M
Operating Cash Flow	273.98M	989.53M	478.85M	722.58M	648.29M
Investing Cash Flow	-1.60B	-180.88M	-942.75M	-8.28B	-2.53B
Financing Cash Flow	-33.09M	738.33M	-2.88B	3.00B	8.17B

Cullen/Frost Bankers Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 142.13
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• 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 142.13 is below the 20-day moving average (MA) of 142.26, above the 50-day MA of 136.56, and above the 200-day MA of 128.59, indicating a neutral trend. The MACD of 2.35 indicates Positive momentum. The RSI at 52.74 is Neutral, neither overbought nor oversold. The STOCH value of 38.54 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
BPOP	75 Outperform	$9.73B	11.86	14.05%	2.31%	5.87%	53.36%
CBSH	73 Outperform	$7.92B	13.16	15.83%	1.97%	12.63%	14.25%
ONB	73 Outperform	$9.73B	13.92	9.02%	2.43%	20.72%	3.63%
ZION	72 Outperform	$9.16B	10.32	13.39%	2.97%	0.12%	27.30%
CFR	69 Neutral	$9.12B	14.56	15.16%	3.05%	2.85%	20.57%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Cullen/Frost Bankers Corporate Events

Cullen/Frost Bankers Expands Board With Two New Directors

On January 27, 2026, longtime director Dr. Chris Avery notified Cullen/Frost Bankers that he will retire and not stand for re-election when his term expires at the company’s 2026 annual shareholders’ meeting scheduled for April 29, 2026, marking the end of board service that began in 2015 and spanned major initiatives such as organic expansion and the COVID-19 pandemic. On January 28, 2026, the company’s board expanded its size from 13 to 15 members and immediately elected Marsha M. Shields, CEO and managing partner of McCombs Enterprises, and veteran Ernst & Young audit leader Jeffrey M. Rummel as independent directors serving on the Audit and Risk Committees, bolstering Cullen/Frost’s governance with deep Texas business ties and substantial financial, risk and corporate oversight experience that is expected to support the bank’s ongoing growth strategy.

The most recent analyst rating on (CFR) stock is a Hold with a $144.00 price target. To see the full list of analyst forecasts on Cullen/Frost Bankers stock, see the CFR Stock Forecast page.