Third Coast Bancshares (TCCO) recorded a net interest margin of 3.80% for the first quarter of 2025, representing an increase from 3.71% in the previous quarter and 3.60% during the same period last year. This improvement highlights the company's ability to effectively manage deposit costs and credit risks, contributing to enhanced shareholder value.
The company also reported robust expansion in its loan portfolio, maintaining high asset quality standards. This disciplined approach has allowed Third Coast to boost both its book value and tangible book value per share. Despite facing some seasonal fluctuations in deposits, the firm's core profitability indicators showed positive momentum, with strengthened capital ratios further emphasizing the stability and resilience of its business model.
As the company continues to navigate varying economic conditions, its focus on sustainable growth remains evident. The recent achievements underscore Third Coast's potential to deliver ongoing value and stability to its shareholders.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 5 analysts, the average target price for Third Coast Bancshares Inc (TCBX, Financial) is $37.67 with a high estimate of $44.00 and a low estimate of $28.34. The average target implies an upside of 23.46% from the current price of $30.51. More detailed estimate data can be found on the Third Coast Bancshares Inc (TCBX) Forecast page.
Based on the consensus recommendation from 4 brokerage firms, Third Coast Bancshares Inc's (TCBX, Financial) average brokerage recommendation is currently 2.3, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Third Coast Bancshares Inc (TCBX, Financial) in one year is $24.16, suggesting a downside of 20.81% from the current price of $30.51. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Third Coast Bancshares Inc (TCBX) Summary page.
Key Business Developments
Release Date: January 23, 2025
- Net Interest Income: $43.4 million in Q4, a 7.6% increase from Q3 and a 16.4% increase from the previous year.
- Loan Growth: $76.6 million increase in Q4 (2% growth); $327.6 million increase for the full year (9% growth).
- Deposit Growth: $316 million increase in Q4 (7.9% growth); $507.4 million increase for the full year (13.3% growth).
- Efficiency Ratio: Improved to 58.8% in Q4, below the target of 60%.
- Net Income: $47.7 million for 2024, a 42.7% increase from the previous year.
- Earnings Per Share: $3.14 basic and $2.78 diluted for 2024.
- Non-Performing Loans Ratio: Increased to 0.7% in Q4 from 0.62% in Q3.
- Net Charge Offs: $879,000 in Q4, or 0.09% of average loans.
- Investment Securities Growth: Increased by $91.9 million in Q4.
- Yield on Securities: 5.44% on purchased securities; 6.31% on total portfolio at period end.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Third Coast Bancshares Inc (TCBX, Financial) achieved 14 consecutive quarters of net interest income growth, with a 7.6% increase in the fourth quarter.
- Loan growth was strong, with a 2% increase in the fourth quarter and a 9% increase for the full year.
- Deposits grew significantly, with a 7.9% increase in the fourth quarter and a 13.3% increase for the full year.
- The company improved its efficiency ratio to 58.8%, surpassing its target of below 60%.
- Net income for 2024 reached $47.7 million, marking a 42.7% increase from the previous year.
Negative Points
- Non-performing loans to total loans ratio increased to 0.7% in the fourth quarter from 0.62% in the third quarter.
- There was a $690,000 charge-off related to loans placed on nonaccrual during the quarter.
- Other noninterest expenses rose in the fourth quarter due to increased salary and bonus expenses.
- The net interest margin was slightly impacted by a large increase in low-margin cash balances.
- The company anticipates a typical seasonal dip in deposits in the first quarter of 2025.
