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Cullen/Frost Bankers Inc CFR

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Solid Second Quarter for Cullen/Frost

Eric Compton, CFA Senior Equity Analyst

Analyst Note

| Eric Compton, CFA |

Narrow-moat Cullen/Frost reported solid second-quarter earnings, with EPS of $1.80 compared with FactSet consensus of $1.56. This equated to a return on equity of 11.2%. Accelerated Paycheck Protection Program forgiveness helped drive net interest income up on a reported basis, increasing roughly $16 million sequentially, or roughly 7%. Excluding PPP-related effects shows NII roughly bottoming out during the quarter, so it appears that core NII may be stabilizing. Meanwhile, management continues to wait for the yield environment to improve before deploying excess liquidity into securities, which would help boost yields and NII once deployed.

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Company Profile

Business Description

Cullen/Frost Bankers is a financial holding company, headquartered in San Antonio. One of the 50 largest U.S. banks, Frost provides a wide range of banking, investments, and insurance services to businesses and individuals across Texas in the Austin, Corpus Christi, Dallas, Fort Worth, Houston, Permian Basin, Rio Grande Valley, and San Antonio regions.

Contact
111 W. Houston Street
San Antonio, TX, 78205
T +1 210 220-4011
Sector Financial Services
Industry Banks - Regional
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 4,685

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