The firm said it raised its rating on the financial holding company as it believes Texas Capital is the most sensitive to higher interest rates.
Wunderlich upped its price target on Texas Capital to $75 from $56.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
Separately, TheStreet Ratings team rates TEXAS CAPITAL BANCSHARES INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate TEXAS CAPITAL BANCSHARES INC (TCBI) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, increase in net income and solid stock price performance. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 12.9%. Since the same quarter one year prior, revenues rose by 14.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The gross profit margin for TEXAS CAPITAL BANCSHARES INC is currently very high, coming in at 90.10%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 24.69% is above that of the industry average.
- Net operating cash flow has significantly increased by 94.84% to -$11.28 million when compared to the same quarter last year. In addition, TEXAS CAPITAL BANCSHARES INC has also vastly surpassed the industry average cash flow growth rate of -97.33%.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Banks industry. The net income increased by 38.8% when compared to the same quarter one year prior, rising from $24.07 million to $33.42 million.
- Powered by its strong earnings growth of 36.53% and other important driving factors, this stock has surged by 25.52% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- You can view the full analysis from the report here: TCBI Ratings Report