Fact based stock research
Texas Capital Bancshares (NasdaqGS:TCBI)

US88224Q1076

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Texas Capital Bancshares stock research in summary

texascapitalbank.com

ANALYSIS: With an Obermatt Combined Rank of 1 (worse than 99% compared with investment alternatives), Texas Capital Bancshares (Regional Banks, USA) shares have lower financial characteristics compared with similar stocks. Shares of Texas Capital Bancshares are low in value (priced high) with a consolidated Value Rank of 21 (worse than 79% of alternatives), show below-average growth (Growth Rank of 25), and are riskily financed (Safety Rank of 45), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 1, is a sell recommendation based on Texas Capital Bancshares's financial characteristics. As the company Texas Capital Bancshares's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 21), low growth (Obermatt Growth Rank of 25), and risky financing practices (Obermatt Safety Rank of 45), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	21
Growth Rank	25
Safety Rank	45
Combined Rank	1

Country	USA
Industry	Regional Banks
Index	Diversity USA, NASDAQ, D.J. US Banks, S&P MIDCAP
Size class	Medium

This stock has achievements: Top 10 Stock.

26-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Texas Capital Bancshares

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	50	31	23	21
GROWTH
GROWTH	16	19	79	25
SAFETY
SAFETY	100	23	93	45
SENTIMENT
SENTIMENT	n/a	48	7	^new
360° VIEW
360° VIEW	n/a	5	47	^new

Most recent update of the stock research: 26-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Texas Capital Bancshares is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	50	31	23	21
GROWTH
GROWTH	16	19	79	25
SAFETY
SAFETY	100	23	93	45
COMBINED
COMBINED	82	3	83	1

Last update of combined financial performance: 26-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Texas Capital Bancshares the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 21 (worse than 79% compared with alternatives), Texas Capital Bancshares shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for Texas Capital Bancshares. Price-to-Sales (P/S) is 63, which means that the stock price compared with what market professionals expect for future sales is lower than 63% of comparable companies, indicating a good value concerning to Texas Capital Bancshares's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 1, meaning that dividends are expected to be lower than for 99% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 55% of alternatives (only 45% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 79% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 21, is a sell recommendation based on Texas Capital Bancshares's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in Texas Capital Bancshares could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, Texas Capital Bancshares looks like an expensive investment today. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	65	64	59	63
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	47	3	9	21
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	78	76	58	45
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	50	31	23	21

Last update of Value Rank: 26-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Texas Capital Bancshares; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 25 (better than 25% compared with alternatives), Texas Capital Bancshares shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Texas Capital Bancshares. Sales Growth has a rank of 84 which means that currently professionals expect the company to grow more than 84% of its competitors. Stock Returns are also above average with a rank of 63. But Capital Growth has only a rank of 13, which means that currently professionals expect the company to grow its invested capital less than 87% of its competitors. Profit Growth is also low, with a rank of only 6, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 25, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 63% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	16	37	39	84
PROFIT GROWTH
PROFIT GROWTH	76	94	98	6
CAPITAL GROWTH
CAPITAL GROWTH	n/a	19	51	13
STOCK RETURNS
STOCK RETURNS	6	1	77	63
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	16	19	79	25

Last update of Growth Rank: 26-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Texas Capital Bancshares.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 45 (better than 45% compared with alternatives), the company Texas Capital Bancshares has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Texas Capital Bancshares is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Texas Capital Bancshares and the other two below average. Refinancing is at 88, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 88% of its competitors. But Leverage is high with a rank of 24, meaning the company has an above-average debt-to-equity ratio. It has more debt than 76% of its competitors. Liquidity is also on the riskier side with a rank of 37, meaning the company generates less profit to service its debt than 63% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 45 (worse than 55% compared with alternatives), Texas Capital Bancshares has a financing structure that is riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Texas Capital Bancshares are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. In the long-term, investors may have a debt challenge with Texas Capital Bancshares and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	90	22	28	24
REFINANCING
REFINANCING	94	48	92	88
LIQUIDITY
LIQUIDITY	82	36	83	37
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	100	23	93	45

Last update of Safety Rank: 26-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Texas Capital Bancshares and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	16	39	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	87	16	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	33	3	^new
MARKET PULSE
MARKET PULSE	n/a	48	44	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	48	7	^new

Last update of Sentiment Rank: 26-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Texas Capital Bancshares.
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