Texas Capital Bancshares, Inc.
Texas Capital Bancshares, Inc. Fundamental Analysis
Texas Capital Bancshares, Inc. (TCBI) shows moderate financial fundamentals with a PE ratio of 12.53, profit margin of 17.71%, and ROE of 9.93%. The company generates $2.0B in annual revenue with strong year-over-year growth of 13.54%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 69.8/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze TCBI's fundamental strength across five key dimensions:
Efficiency Score
WeakTCBI struggles to generate sufficient returns from assets.
Valuation Score
ExcellentTCBI trades at attractive valuation levels.
Growth Score
ModerateTCBI shows steady but slowing expansion.
Financial Health Score
ModerateTCBI shows balanced financial health with some risks.
Profitability Score
ModerateTCBI maintains healthy but balanced margins.
Key Financial Metrics
Is TCBI Expensive or Cheap?
P/E Ratio
TCBI trades at 12.53 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, TCBI's PEG of 0.04 indicates potential undervaluation.
Price to Book
The market values Texas Capital Bancshares, Inc. at 1.24 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 12.40 times EBITDA. This signals the market has high growth expectations.
How Well Does TCBI Make Money?
Net Profit Margin
For every $100 in sales, Texas Capital Bancshares, Inc. keeps $17.71 as profit after all expenses.
Operating Margin
Core operations generate 23.70 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $9.93 in profit for every $100 of shareholder equity.
ROA
Texas Capital Bancshares, Inc. generates $1.07 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Texas Capital Bancshares, Inc. generates strong operating cash flow of $859.02M, reflecting robust business health.
Free Cash Flow
Texas Capital Bancshares, Inc. generates strong free cash flow of $857.45M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $19.63 in free cash annually.
FCF Yield
TCBI converts 20.37% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
12.53
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.04
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.24
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.15
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.24
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.10
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.10
vs 25 benchmark
ROA
Return on assets percentage
0.01
vs 25 benchmark
ROCE
Return on capital employed
0.10
vs 25 benchmark
How TCBI Stacks Against Its Sector Peers
| Metric | TCBI Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 12.53 | 18.96 | Better (Cheaper) |
| ROE | 9.93% | 797.00% | Weak |
| Net Margin | 17.71% | -7699.00% (disorted) | Strong |
| Debt/Equity | 0.24 | 2.38 | Strong (Low Leverage) |
| Current Ratio | 0.10 | 560.28 | Weak Liquidity |
| ROA | 1.07% | -23967.00% (disorted) | Weak |
TCBI outperforms its industry in 3 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Texas Capital Bancshares, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
90.10%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
458.03%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
-84.72%
Industry Style: Value, Dividend, Cyclical
Declining