Cullen/Frost Bankers, Inc. (CFR) Q3 2025 Earnings Call Transcript
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 30 2025
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Should l Buy CFR?
Source: SeekingAlpha
Net Income Cullen/Frost earned $172.7 million or $2.67 per share in Q3 2025, up 19.2% from $144.8 million or $2.24 per share in Q3 2024. The increase was attributed to strong organic growth and strategic expansion.
Return on Average Assets and Average Common Equity Return on average assets was 1.32% and return on average common equity was 16.72% in Q3 2025, compared to 1.16% and 15.48% in Q3 2024. The improvement reflects better profitability and operational efficiency.
Average Deposits Average deposits were $42.1 billion in Q3 2025, a 3.3% increase from $40.7 billion in Q3 2024. Growth was driven by strategic expansion and customer acquisition.
Average Loans Average loans grew to $21.5 billion in Q3 2025, a 6.8% increase from $20.1 billion in Q3 2024. The growth was supported by strong commercial and consumer lending activities.
Consumer Real Estate Loan Portfolio The portfolio grew to $3.5 billion in Q3 2025, up $547 million or 18.7% year-over-year. Growth was driven by record performance in mortgage lending.
Commercial Loans Period-end commercial loans grew by 5.1% year-over-year, with energy loans up 17%, C&I loans up 6.8%, and CRE loans up 2.7%. Growth was partially offset by payoffs in multifamily loans.
Nonperforming Assets Nonperforming assets declined to $47 million in Q3 2025 from $106 million in Q3 2024, driven by resolution of problem credits and return of a borrower to accrual status.
Net Charge-Offs Net charge-offs were $6.6 million in Q3 2025, down from $9.6 million in Q3 2024. The improvement was due to better credit quality and resolution of risk-grade loans.
Net Interest Margin Net interest margin increased to 3.69% in Q3 2025 from 3.67% in Q2 2025, driven by a mix shift to higher-yielding assets.
Noninterest Income Noninterest income saw strong growth, with trust and investment fees up 9.3% year-over-year and insurance commissions up 6.9% year-to-date over 2024. Growth was driven by a focus on sales culture and organic growth strategy.
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Analyst Views on CFR
Wall Street analysts forecast CFR stock price to rise
10 Analyst Rating
4 Buy
4 Hold
2 Sell
Hold
Current: 136.140
Low
125.00
Averages
148.60
High
163.00
Current: 136.140
Low
125.00
Averages
148.60
High
163.00
About CFR
Cullen/Frost Bankers, Inc. is a financial holding company and a bank holding company. The Company provides an array of products and services throughout numerous Texas markets. The Company's segments include Banking and Frost Wealth Advisors. The Banking segment includes both commercial and consumer banking services and Frost Insurance Agency. Commercial banking services are provided to corporations and other business clients and include a wide array of lending and cash management products. Consumer banking services include direct lending and depository services. Frost Insurance Agency provides insurance brokerage services to individuals and businesses covering corporate and personal property and casualty products, as well as group health and life insurance products. The Frost Wealth Advisors segment includes fee-based services within private trust, retirement services, and financial management services, including personal wealth management and securities brokerage services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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Cullen/Frost Bank Q1 Earnings Exceed Expectations
- Strong Earnings Performance: Cullen/Frost Bank reported a Q1 GAAP EPS of $2.65, beating expectations by $0.18, which highlights the company's robust profitability and enhances investor confidence in its financial health.
- Significant Revenue Growth: The bank's revenue for Q1 reached $597.1 million, reflecting a 10.5% year-over-year increase and surpassing market expectations by $13.96 million, indicating sustained competitiveness and driving overall business expansion.
- Robust Capital Ratios: As of the end of Q1 2026, the Common Equity Tier 1, Tier 1, and Total Risk-Based Capital Ratios stood at 14.07%, 14.51%, and 15.89%, respectively, all exceeding well-capitalized levels and meeting Basel III minimum requirements, showcasing the bank's solid financial foundation.
- Optimistic Market Outlook: Despite Cullen/Frost Bank's strong performance, analysts suggest that the stock price is not yet attractive enough for an upgrade, reflecting a cautious sentiment among investors regarding future growth prospects.
See More
Cullen/Frost Bankers to Announce Q1 Earnings on April 30
- Earnings Announcement: Cullen/Frost Bankers is set to release its Q1 2023 earnings report on April 30 before market open, with a consensus EPS estimate of $2.49, reflecting an 8.3% year-over-year growth, indicating sustained profitability.
- Revenue Expectations: The anticipated revenue for Q1 is $583.14 million, representing a 7.9% year-over-year increase, which underscores the bank's robust performance in lending and financial services, potentially boosting investor confidence.
- Historical Performance: Over the past year, CFR has exceeded EPS estimates 100% of the time and revenue estimates 50% of the time, demonstrating reliability in earnings forecasts that may attract more investor interest.
- Estimate Revisions: In the last three months, EPS estimates have seen 11 upward revisions with no downward adjustments, while revenue estimates have experienced 6 upward and 2 downward revisions, indicating a positive trend in market expectations for CFR's future performance.
See More
Frost Bank Partners with Texas Rangers for Financial Literacy
- Partnership Announcement: Frost Bank has partnered with the Texas Rangers as their Official Financial Literacy Partner, aiming to enhance financial literacy in the Dallas-Fort Worth area, reflecting a shared commitment to community empowerment by both organizations.
- Youth Education Initiative: The collaboration will provide financial literacy education through the Rangers Youth Academy, equipping young people with essential financial skills that promote their future development and strengthen Frost's community impact in Texas.
- Frost Fridays Activation: Special game day activations called Frost Fridays will be held during all Friday home games, designed to enhance fan engagement and interaction, thereby increasing brand visibility and customer loyalty.
- Sponsorship Portfolio Expansion: This partnership signifies Frost Bank's continued expansion of its sponsorship portfolio, which already includes popular teams like the San Antonio Spurs and Houston Rockets, showcasing its strong presence in the Texas market.
See More
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- Positive Outlook for Luxury Stocks: Analysts remain optimistic about the recovery trajectory of luxury stocks, indicating a long-anticipated resurgence in demand.
See More
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- Customer Satisfaction Leader: Frost Bank has achieved the highest ranking in retail banking customer satisfaction in Texas for the 17th consecutive year, with an overall satisfaction index score of 757, which is 76 points above the Texas regional average, showcasing its exceptional customer service performance.
- Comprehensive Excellence: The bank ranked No. 1 in all eight dimensions of the study, including net promoter score, trust, staff service, account offerings, customer convenience, time and cost savings, complaint resolution, and digital channels, indicating high customer recognition across all aspects.
- Sustained Leadership: J.D. Power has surveyed Texas as a separate region, and Frost has topped the Texas list for 17 years, reflecting its enduring competitiveness and customer loyalty in the retail banking sector.
- Strong Asset Base: As of December 31, 2025, Frost Bank reported total assets of $53 billion, positioning itself among the top 50 U.S. banks, and providing a full range of banking, investment, and insurance services, further solidifying its market position.
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