Fact based stock research
Cullen/Frost (NYSE:CFR)

US2298991090

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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.

Cullen/Frost stock research in summary

frostbank.com

ANALYSIS: With an Obermatt Combined Rank of 7 (worse than 93% compared with investment alternatives), Cullen/Frost (Regional Banks, USA) shares have lower financial characteristics compared with similar stocks. Shares of Cullen/Frost are low in value (priced high) with a consolidated Value Rank of 5 (worse than 95% of alternatives), show below-average growth (Growth Rank of 47), and are riskily financed (Safety Rank of 37), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 7, is a sell recommendation based on Cullen/Frost's financial characteristics. As the company Cullen/Frost's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 5), low growth (Obermatt Growth Rank of 47), and risky financing practices (Obermatt Safety Rank of 37), 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	5
Growth Rank	47
Safety Rank	37
Combined Rank	7

Country	USA
Industry	Regional Banks
Index	D.J. US Banks, S&P MIDCAP
Size class	XX-Large

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

Further information

Multiple opinions. One number.

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

Research History: Cullen/Frost

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	17	7	23	5
GROWTH
GROWTH	28	63	25	47
SAFETY
SAFETY	98	41	47	37
SENTIMENT
SENTIMENT	n/a	1	49	^new
360° VIEW
360° VIEW	n/a	3	15	^new

Most recent update of the stock research: 18-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better Cullen/Frost is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	17	7	23	5
GROWTH
GROWTH	28	63	25	47
SAFETY
SAFETY	98	41	47	37
COMBINED
COMBINED	40	16	9	7

Last update of combined financial performance: 18-Apr-2024. Stock analysis on combined financial performance: The higher the rank of Cullen/Frost the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 5 (worse than 95% compared with alternatives), Cullen/Frost shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Cullen/Frost. Price-to-Sales is 12 which means that the stock price compared with what market professionals expect for future profits is higher than 88% of comparable companies, indicating a low value concerning Cullen/Frost's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 5, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Cullen/Frost. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 13 and Dividend Yield, which is lower than 67% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 5, is a sell recommendation based on Cullen/Frost's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Cullen/Frost? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Cullen/Frost? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Cullen/Frost may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. 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 essential 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)	13	9	31	12
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	18	3	43	13
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	20	9	5	5
DIVIDEND YIELD
DIVIDEND YIELD	59	31	57	33
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	17	7	23	5

Last update of Value Rank: 18-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Cullen/Frost; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 47 (better than 47% compared with alternatives), Cullen/Frost 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 three out of four indicators below average for Cullen/Frost. Only Capital Growth has a good rank of 85, which means that currently professionals expect the company to grow its invested capital more than 48% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 18 which means that currently professionals expect the company to grow less than 82% of its competitors. Profit Growth with a rank of 48 and Stock Returns with a rank of 43 are also low (below 57% of alternative investments). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 47, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Cullen/Frost is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. 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 limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	20	22	63	18
PROFIT GROWTH
PROFIT GROWTH	42	43	85	48
CAPITAL GROWTH
CAPITAL GROWTH	n/a	63	4	85
STOCK RETURNS
STOCK RETURNS	59	91	9	43
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	28	63	25	47

Last update of Growth Rank: 18-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Cullen/Frost.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 37 (better than 37% compared with alternatives), the company Cullen/Frost 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 Cullen/Frost 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 Cullen/Frost. Liquidity is at 88, meaning the company generates more profit to service its debt than 88% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 35, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 65% of its competitors. Leverage is also high at a rank of 22, which means that the company has an above-average debt-to-equity ratio. It has more debt than 78% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 37 (worse than 63% compared with alternatives), Cullen/Frost has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	90	20	20	22
REFINANCING
REFINANCING	67	48	37	35
LIQUIDITY
LIQUIDITY	85	73	86	88
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	98	41	47	37

Last update of Safety Rank: 18-Apr-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Cullen/Frost 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	3	54	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	26	56	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	74	19	^new
MARKET PULSE
MARKET PULSE	n/a	4	68	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	1	49	^new

Last update of Sentiment Rank: 18-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Cullen/Frost.
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