Stellar Bancorp (STEL) AI Stock Analysis

• Market Cap: $1.62B
• Dividend Yield: 1.8%
• Average Volume (3M): 244.73K
• Price to Earnings (P/E): 15.7
• Beta (1Y): 0.65
• Revenue Growth: -4.40%
• EPS Growth: -8.80%
• Country: US
• Employees: 1,054
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.58
• Shares Outstanding: 51,187,492
• 10 Day Avg. Volume: 238,155
• 30 Day Avg. Volume: 244,731
• PEG Ratio: -1.08
• Price to Book (P/B): 0.94
• Price to Sales (P/S): 2.43
• P/FCF Ratio: 11.86
• Enterprise Value/Market Cap: 0.91
• Enterprise Value/Revenue: 2.43
• Enterprise Value/Gross Profit: 3.51
• Enterprise Value/Ebitda: 9.26
• 1Y Price Target: $32.50
• Price Target Upside: 2.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: $36.00 ▲(13.92% Upside)

Stellar Bancorp's overall stock score is driven by its solid financial performance and positive technical indicators. The company's strategic initiatives, such as the dividend increase and strong deposit growth, are positive, but challenges in revenue growth and increased expenses present near-term risks. The stock is reasonably valued, making it an attractive option for investors seeking stability and moderate growth potential.

Positive Factors

Strong Deposit Growth

Strong deposit growth indicates increased brand awareness and effective market share gains, supporting long-term financial stability and expansion.

Capital Position Strengthened

A strengthened capital position enhances financial resilience and supports future growth initiatives, ensuring stability in challenging market conditions.

Dividend Increase

The dividend increase reflects a commitment to shareholder value, potentially enhancing investor attractiveness and supporting long-term market positioning.

Negative Factors

Decreased Net Income

A decrease in net income can signal challenges in maintaining profitability, potentially impacting future earnings and investor confidence.

Higher Noninterest Expenses

Rising noninterest expenses can pressure profit margins, necessitating cost management to maintain operational efficiency and long-term profitability.

Loan Payoffs and Paydowns

Increased loan payoffs can hinder loan growth, affecting interest income and potentially constraining revenue expansion in the long term.

Stellar Bancorp Business Overview & Revenue Model

Company Description

Stellar Bancorp (STEL) is a financial services holding company headquartered in Texas, primarily focused on providing a wide range of banking and financial products to consumers and businesses. The company operates through its subsidiary, Stellar Bank, which offers traditional banking services such as checking and savings accounts, loans, mortgages, and wealth management services. Stellar Bancorp serves diverse markets, aiming to enhance customer experience through innovative banking solutions and a commitment to community development.

How the Company Makes Money

Stellar Bancorp generates revenue primarily through interest income from loans and mortgages, as well as fees from various banking services. The core revenue streams include interest earned on commercial and consumer loans, residential mortgages, and investment securities. Additionally, the company earns non-interest income through service fees, transaction fees, and wealth management services. Strategic partnerships with local businesses and community organizations also play a significant role in expanding its customer base and enhancing its service offerings, contributing to overall profitability.

Stellar Bancorp Financial Statement Overview

Summary

Stellar Bancorp demonstrates a solid financial position with strong profitability margins and a conservative balance sheet. While revenue growth has been a challenge, the company maintains operational efficiency and effective cash flow management. Continued focus on revenue growth and cash flow optimization will be crucial for sustaining long-term financial health.

Income Statement

Stellar Bancorp shows a stable income statement with a strong gross profit margin of 69.2% TTM, indicating efficient cost management. However, the net profit margin has slightly decreased to 16.9% TTM, reflecting a decline in profitability. Revenue growth has been negative at -1.26% TTM, which is a concern for future earnings potential. Despite this, the EBIT and EBITDA margins remain healthy at 21.3% and 26.3% TTM, respectively, showcasing operational efficiency.

Balance Sheet

The balance sheet is robust with a low debt-to-equity ratio of 0.042 TTM, indicating conservative leverage. Return on equity is moderate at 6.3% TTM, suggesting decent profitability relative to shareholder equity. The equity ratio stands at 15.6%, reflecting a solid capital structure with a good proportion of equity financing.

Cash Flow

Cash flow analysis reveals a positive free cash flow growth rate of 6.43% TTM, indicating improved cash generation. The free cash flow to net income ratio is strong at 97.7% TTM, suggesting efficient conversion of earnings into cash. However, the operating cash flow to net income ratio is low, highlighting potential issues in cash flow management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	601.77M	625.45M	615.38M	343.35M	261.75M	249.92M
Gross Profit	416.54M	433.92M	452.38M	258.60M	239.45M	183.47M
EBITDA	158.18M	176.99M	196.35M	76.78M	107.44M	63.61M
Net Income	101.94M	115.00M	130.50M	51.43M	81.55M	45.53M
Balance Sheet
Total Assets	10.63B	10.91B	10.65B	10.90B	7.10B	3.95B
Cash, Cash Equivalents and Short-Term Investments	2.57B	2.10B	1.79B	2.18B	2.53B	738.69M
Total Debt	70.20M	70.11M	159.76M	173.29M	212.94M	66.45M
Total Liabilities	8.97B	9.30B	9.13B	9.52B	6.29B	3.40B
Stockholders Equity	1.65B	1.61B	1.52B	1.38B	816.47M	546.45M
Cash Flow
Free Cash Flow	85.54M	127.96M	161.36M	105.25M	104.45M	53.88M
Operating Cash Flow	87.58M	132.62M	168.22M	109.07M	107.38M	61.06M
Investing Cash Flow	244.04M	246.09M	295.25M	73.76M	-754.82M	-961.10M
Financing Cash Flow	-119.39M	133.27M	-435.94M	-568.63M	982.19M	976.56M

Stellar Bancorp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 31.60
• 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 STEL, the sentiment is Positive. The current price of 31.6 is below the 20-day moving average (MA) of 31.77, above the 50-day MA of 30.59, and above the 200-day MA of 28.80, indicating a neutral trend. The MACD of 0.37 indicates Positive momentum. The RSI at 53.00 is Neutral, neither overbought nor oversold. The STOCH value of 30.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STEL.

Stellar Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SRCE	82 Outperform	$1.58B	10.54	12.65%	2.35%	5.09%	15.78%
NBHC	79 Outperform	$1.49B	12.36	9.06%	3.04%	-2.46%	-1.98%
STEL	76 Outperform	$1.62B	15.73	6.38%	1.80%	-4.40%	-8.80%
GABC	73 Outperform	$1.52B	14.03	10.75%	2.87%	30.45%	3.13%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
LKFN	63 Neutral	$1.52B	15.68	13.50%	3.35%	-2.90%	-1.47%
CLBK	60 Neutral	$1.71B	111.23	1.34%	―	-3.60%	-8.63%

Stellar Bancorp Corporate Events

Stellar Bancorp Increases Quarterly Dividend to $0.15

On November 20, 2025, Stellar Bancorp, Inc. announced an increase in its quarterly cash dividend to $0.15 per share, up from the previous $0.14, payable on December 31, 2025, to shareholders of record as of December 15, 2025. This dividend increase reflects the company’s ongoing commitment to delivering value to its shareholders and may enhance its attractiveness to investors, potentially impacting its market positioning positively.

Stellar Bancorp Reports Q3 2025 Financial Results

Stellar Bancorp reported its third quarter 2025 financial results, showing a slight decrease in net income to $25.7 million from $26.4 million in the previous quarter. The company highlighted improved net interest income and margin, growth in deposits, and a strengthened balance sheet. Stellar has been repositioning its loan portfolio to reduce exposure to non-relationship real estate commitments and increase the mix of commercial and industrial (C&I) and real estate loans. The bank’s credit quality remains strong, and it is well-positioned to capitalize on merger-related disruptions in its Texas markets. The company’s total assets increased to $10.63 billion, supported by core deposit growth, while total loans decreased to $7.17 billion. Stellar also completed the redemption of $30 million of subordinated debt, further solidifying its capital position.