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Relative valuation derived from Financials sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 61.3GRADE B
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
13.8%
Sector: 8.5%
Dividend Analysis audit
No Dividend
This company does not currently pay a dividend.
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, CULLEN/FROST BANKERS, INC. (CFR) receives a "Hold" rating with a composite score of 54.5/100, ranked #521 out of 4446 stocks. Key factor scores: Quality 61/100, Value 70/100, Momentum 51/100. This is quantitative analysis only — not investment advice.
CULLEN/FROST BANKERS, INC. (CFR) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does CULLEN/FROST BANKERS, INC. Do?
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. CULLEN/FROST BANKERS, INC. (CFR) is classified as a mid-cap stock in the Financials sector, specifically within the Banking industry. The company is led by CEO Phillip D. Green and employs approximately 4,980 people, headquartered in SAN ANTONIO, Texas. With a market capitalization of $8.7B, CFR is one of the notable companies in the Financials sector.
CULLEN/FROST BANKERS, INC. (CFR) Stock Rating — Hold (April 2026)
As of April 2026, CULLEN/FROST BANKERS, INC. receives a Hold rating with a composite score of 54.5/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.CFR ranks #521 out of 4,446 stocks in our coverage universe. Within the Financials sector, CULLEN/FROST BANKERS, INC. ranks #165 of 891 stocks, placing it in the top quartile of its Financials peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
CFR Stock Price and 52-Week Range
CULLEN/FROST BANKERS, INC. (CFR) currently trades at $142.50. The stock lost $2.46 (1.7%) in the most recent trading session. The 52-week high for CFR is $148.97, which means the stock is currently trading -4.3% from its annual peak. The 52-week low is $100.31, putting the stock 42.1% above its annual trough. Recent trading volume was 468K shares, suggesting relatively thin trading activity.
Is CFR Overvalued or Undervalued? — Valuation Analysis
CULLEN/FROST BANKERS, INC. (CFR) carries a value factor score of 70/100 in the Blank Capital model, suggesting the stock trades at a meaningful discount to its fundamental earning power. The trailing price-to-earnings ratio is 14.32x, compared to the Financials sector average of 14.88x — a discount of 4%. The price-to-book ratio stands at 1.97x, versus the sector average of 1.22x. The price-to-sales ratio is 4.15x, compared to 0.90x for the average Financials stock. On an enterprise value basis, CFR trades at 10.78x EV/EBITDA, versus 3.26x for the sector.
Based on these multiples, CULLEN/FROST BANKERS, INC. appears attractively valued relative to both its sector peers and the broader market. Value-oriented investors may find the current entry point compelling, particularly if the company's fundamental quality metrics also score well.
CULLEN/FROST BANKERS, INC. Profitability — ROE, Margins, and Quality Score
CULLEN/FROST BANKERS, INC. (CFR) earns a quality factor score of 61/100, indicating solid business quality with consistent operational execution. The return on equity (ROE) is 13.8%, compared to the Financials sector average of 8.5%, which is within a healthy range. Return on assets (ROA) comes in at 1.2% versus the sector average of 1.2%.
On a margin basis, CULLEN/FROST BANKERS, INC. reports gross margins of 0.0%. The operating margin is 34.4% (sector: 21.8%). Net profit margin stands at 28.9%, versus 17.7% for the average Financials stock. Revenue growth is running at 11.7% on a trailing basis, compared to 9.4% for the sector. The overall profitability profile is adequate, though there may be room for margin expansion.
CFR Debt, Balance Sheet, and Financial Health
CULLEN/FROST BANKERS, INC. has a debt-to-equity ratio of 1060.0%, compared to the Financials sector average of 121.0%. This elevated leverage warrants close monitoring, as it increases the company's sensitivity to rising interest rates and economic downturns. The current ratio is 1.09x, suggesting adequate working capital coverage. Cash and equivalents stand at $681M.
CFR has a beta of 0.90, meaning it is roughly in line with the broader market in terms of price volatility. The stability factor score for CULLEN/FROST BANKERS, INC. is 82/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
CULLEN/FROST BANKERS, INC. Revenue and Earnings History — Quarterly Trend
In TTM 2026, CULLEN/FROST BANKERS, INC. reported revenue of $2.17B and earnings per share (EPS) of $9.92. Net income for the quarter was $629M. Gross margin was 0.0%. Operating income came in at $749M.
In FY 2025, CULLEN/FROST BANKERS, INC. reported revenue of $2.24B and earnings per share (EPS) of $9.92. Net income for the quarter was $649M. Revenue grew 8.3% year-over-year compared to FY 2024. Operating income came in at $772M.
In Q3 2025, CULLEN/FROST BANKERS, INC. reported revenue of $567M and earnings per share (EPS) of $2.67. Net income for the quarter was $174M. Revenue grew 9.5% year-over-year compared to Q3 2024. Operating income came in at $208M.
In Q2 2025, CULLEN/FROST BANKERS, INC. reported revenue of $547M and earnings per share (EPS) of $2.39. Net income for the quarter was $157M. Revenue grew 7.7% year-over-year compared to Q2 2024. Operating income came in at $187M.
Over the past 8 quarters, CULLEN/FROST BANKERS, INC. has demonstrated a growth trajectory, with revenue expanding from $508M to $2.17B. Investors analyzing CFR stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
CFR Dividend Yield and Income Analysis
CULLEN/FROST BANKERS, INC. (CFR) does not currently pay a dividend. This is common among smaller companies in the Banking industry that prefer to reinvest cash flows into business expansion rather than returning capital to shareholders. Income-focused investors looking for Financials dividend stocks may want to explore other Financials stocks or use the stock screener to filter by dividend yield.
CFR Momentum and Technical Analysis Profile
CULLEN/FROST BANKERS, INC. (CFR) has a momentum factor score of 51/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 28/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 18/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
CFR vs Competitors — Financials Sector Ranking and Peer Comparison
Comparing CFR against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full CFR vs S&P 500 (SPY) comparison to assess how CULLEN/FROST BANKERS, INC. stacks up against the broader market across all factor dimensions.
CFR Next Earnings Date
No upcoming earnings date has been announced for CULLEN/FROST BANKERS, INC. (CFR) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy CFR? — Investment Thesis Summary
CULLEN/FROST BANKERS, INC. presents a balanced picture with arguments on both sides. The quality score of 61/100 indicates above-average profitability and business fundamentals. The value score of 70/100 suggests attractive pricing relative to fundamentals. Low volatility (stability score 82/100) reduces downside risk.
In summary, CULLEN/FROST BANKERS, INC. (CFR) earns a Hold rating with a composite score of 54.5/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on CFR stock.
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Institutional Research Dossier
CULLEN/FROST BANKERS, INC. (CFR) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
We maintain a Hold rating on Cullen/Frost Bankers (CFR). While the company exhibits strong profitability metrics and a relatively attractive valuation compared to its peers, its comparatively weak investment score and high debt-to-equity ratio raise concerns about future growth prospects and financial flexibility. The bank's Texas-centric operations, while currently a strength, also present a geographic concentration risk that warrants caution.
CFR's superior efficiency, as evidenced by its higher operating and net margins, and its focus on relationship banking provide a degree of stability. However, the bank's ability to sustain its historical performance in a potentially changing interest rate environment and competitive landscape remains uncertain. Investors should carefully weigh the bank's strengths against its potential vulnerabilities before considering a significant investment.
Business Strategy & Overview
Cullen/Frost Bankers operates primarily through its subsidiary, Frost Bank, providing a comprehensive suite of commercial and consumer banking services across Texas. The bank's core strategy revolves around relationship banking, emphasizing personalized service and long-term client relationships. This approach aims to foster customer loyalty and generate stable, recurring revenue streams. Frost Bank differentiates itself through its commitment to customer service, often cited as a key competitive advantage in the Texas market.
The company's revenue is derived from net interest income (the difference between interest earned on loans and interest paid on deposits) and non-interest income, which includes fees from services like treasury management, wealth management, and brokerage. CFR's strategic focus on expanding its wealth management division, Frost Wealth Advisors, aims to diversify its revenue streams and capitalize on the growing wealth in Texas. The bank also invests in technology to enhance its digital banking capabilities and improve customer experience.
CFR's geographic focus on Texas is both a strength and a weakness. The Texas economy has generally outperformed the national average in recent years, providing a favorable environment for loan growth and business expansion. However, this concentration also exposes the bank to regional economic downturns and industry-specific risks, such as fluctuations in the energy sector. The company mitigates this risk through diversification across various industries within Texas.
The bank's capital allocation strategy prioritizes organic growth through branch expansion and investment in technology. CFR also engages in selective acquisitions to expand its market presence and service offerings. The company maintains a conservative approach to risk management, focusing on high-quality loan portfolios and strong capital ratios. This approach has historically resulted in lower loan losses compared to its peers, but it may also limit its growth potential in certain market segments.
Execution Benchmarks audit
Revenue Growth
YOY expansion rate
11.7%
Sector: 9.4%
+25% VS SCTR
Economic Moat Analysis
Cullen/Frost Bankers possesses a Narrow economic moat, primarily derived from its strong brand reputation and established customer relationships in Texas. Frost Bank has cultivated a loyal customer base over its long history, benefiting from high switching costs for customers who value personalized service and local expertise. This reputation allows the bank to command a premium in certain markets and retain customers even in the face of competitive pressures.
The bank's focus on relationship banking creates a degree of customer stickiness. Businesses and individuals who have established long-term relationships with Frost Bank are less likely to switch to competitors, even if they offer slightly lower rates or fees. This is particularly true for commercial clients who rely on Frost Bank for a range of financial services, including lending, treasury management, and wealth management.
However, the moat is narrow due to the increasing commoditization of banking services and the rise of online and mobile banking platforms. While Frost Bank has invested in technology to enhance its digital capabilities, it faces intense competition from larger national banks and fintech companies that offer a wider range of digital services and lower fees. The bank's geographic concentration in Texas also limits its ability to diversify its revenue streams and reduce its reliance on the regional economy.
Furthermore, the banking industry is subject to intense regulatory scrutiny, which can increase compliance costs and limit the bank's ability to innovate. The regulatory environment also creates barriers to entry, but these barriers are not insurmountable, and new competitors can emerge with innovative business models and technologies. Therefore, while CFR possesses some competitive advantages, its moat is not wide enough to protect it from significant competitive pressures in the long term.
Financial Health & Profitability
Cullen/Frost Bankers demonstrates solid financial health, characterized by strong profitability metrics and a stable balance sheet. The company's ROE of 13.8% significantly exceeds the sector average of 8.5%, indicating efficient use of equity. Similarly, its operating margin of 34.4% and net margin of 28.9% are substantially higher than the sector averages of 22.0% and 17.8%, respectively, reflecting superior operational efficiency and cost management.
Revenue growth has been consistent, with a TTM revenue growth rate of 11.7% compared to the sector average of 9.3%. The quarterly financial history reveals a steady increase in revenue from $1.99B in FY2023 to $2.24B in FY2025, indicating a positive growth trajectory. Net income has also shown improvement, although there have been some fluctuations quarter to quarter. The operating margin has remained relatively stable, hovering around 33-40% in recent quarters.
However, CFR's debt-to-equity ratio of 1,060.00 is significantly higher than the sector average of 115.00, raising concerns about its leverage and financial risk. While the company's current ratio of 1.09 indicates sufficient liquidity to meet its short-term obligations, the high debt level could constrain its ability to invest in future growth opportunities or weather economic downturns. The absence of free cash flow data makes it difficult to assess the company's cash flow generation capabilities.
The company's strong profitability and revenue growth are positive indicators, but the high debt-to-equity ratio warrants careful monitoring. Investors should assess the company's ability to manage its debt burden and generate sufficient cash flow to support its growth plans. A reduction in debt levels would improve the company's financial flexibility and reduce its vulnerability to adverse economic conditions.
Valuation Assessment
Cullen/Frost Bankers appears reasonably valued based on its current multiples. The company's P/E ratio of 13.3x is lower than the sector average of 15.5x, suggesting that the stock may be undervalued relative to its earnings. Similarly, its EV/EBITDA ratio of 2.4x is significantly lower than the sector average of 3.5x, further supporting the argument that the stock is attractively priced.
However, valuation should not be considered in isolation. The company's growth prospects, financial health, and competitive position must also be taken into account. While CFR's revenue growth and profitability metrics are strong, its high debt-to-equity ratio and narrow economic moat raise concerns about its long-term sustainability. These factors may justify a lower valuation multiple compared to its peers.
The absence of free cash flow data makes it difficult to assess the company's intrinsic value using discounted cash flow analysis. However, based on its earnings and EBITDA, the stock appears to be trading at a reasonable discount to its peers. A more comprehensive valuation analysis would require additional information about the company's future growth prospects and cash flow generation capabilities.
Overall, CFR's valuation appears fair, reflecting a balance between its strong profitability and growth potential and its financial risks and competitive challenges. Investors should carefully consider these factors before making an investment decision. A potential catalyst for a higher valuation would be a reduction in the company's debt levels or an improvement in its competitive position.
Risk & Uncertainty
Cullen/Frost Bankers faces several key risks that could impact its future performance. One of the most significant risks is its geographic concentration in Texas. A downturn in the Texas economy, particularly in the energy sector, could negatively affect the bank's loan portfolio and profitability. While the bank has diversified its loan portfolio across various industries, it remains vulnerable to regional economic shocks.
Another risk is the increasing competition in the banking industry. Larger national banks and fintech companies are aggressively expanding their presence in Texas, offering a wider range of digital services and lower fees. This increased competition could erode Frost Bank's market share and put pressure on its margins. The bank's ability to adapt to changing customer preferences and technological advancements will be crucial to its long-term success.
Interest rate risk is also a significant concern. Changes in interest rates can affect the bank's net interest income and the value of its assets and liabilities. A rapid increase in interest rates could negatively impact the bank's loan portfolio and reduce its profitability. The bank's ability to manage its interest rate exposure will be critical to mitigating this risk.
Finally, regulatory risk is an ongoing concern for all banks. Changes in banking regulations can increase compliance costs and limit the bank's ability to operate its business. The bank must stay abreast of regulatory developments and adapt its policies and procedures accordingly. Failure to comply with regulations could result in fines, penalties, and reputational damage.
Bulls Say / Bears Say
The Bull Case
BULL VIEWCullen/Frost's Texas-centric focus allows it to capitalize on the state's robust economic growth, leading to above-average loan growth and profitability.
BULL VIEWThe bank's strong reputation for customer service and relationship banking creates a loyal customer base, providing a stable source of revenue and a competitive advantage.
BULL VIEWCFR's conservative management and strong capital position provide downside protection in a volatile economic environment, making it a safe haven for investors.
The Bear Case
BEAR VIEWCullen/Frost's high debt-to-equity ratio exposes it to significant financial risk, potentially limiting its ability to invest in future growth or withstand economic downturns.
BEAR VIEWThe bank's geographic concentration in Texas makes it vulnerable to regional economic shocks, particularly in the energy sector, which could negatively impact its loan portfolio.
BEAR VIEWIncreasing competition from larger national banks and fintech companies could erode Frost Bank's market share and put pressure on its margins, hindering its long-term growth prospects.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score CFR and 4,400+ other equities.
CULLEN/FROST BANKERS, INC. exhibits a 162% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
1.2%
Sector: 1.2%
Gross Margin
Pricing power and cost efficiency
0.0%
Sector: 0.0%
Operating Margin
Core business profitability
34.4%
Sector: 21.8%
Net Margin
Bottom-line profitability
28.9%
Sector: 17.7%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
