In a recent move, Robert W. Stallings, a director of Texas Capital Bancshares Inc. (NASDAQ:TCBI), has made a significant investment in the company's stock. Stallings purchased a total of 5,500 depositary shares, representing a 1/40th interest in a share of the issuer's 5.75% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series B.
The transactions, which took place over two consecutive days, saw Stallings acquire 500 shares at $20.60 each on July 23, followed by an additional 5,000 shares at $20.53 each on July 24. The total value of these purchases amounted to $112,950, reflecting Stallings' confidence in the financial institution.
Stallings' investment adds to his already substantial holdings in Texas Capital Bancshares, which include both common and preferred stock. According to the report, following these recent transactions, Stallings now directly owns 3,794 depositary shares for Series B Preferred Stock. Indirectly, through the Stallings Foundation and SCG Ventures LP, he is associated with holdings of 174,706 and 5,000 depositary shares, respectively. Additionally, SCG Ventures LP holds 84,369 shares of common stock, further cementing Stallings' stake in the company.
The depositary shares acquired by Stallings are tied to Texas Capital Bancshares' preferred stock, which carries a 5.75% fixed-rate non-cumulative perpetual dividend. This type of stock is a preferred equity instrument and is often considered a reflection of an investor's long-term commitment to a company's growth and success.
Investors tend to closely watch the buying and selling activities of company insiders like Stallings, as these can be indicative of the company's future performance and the insiders' belief in the company's value. With this substantial purchase, stakeholders in Texas Capital Bancshares may view the director's increased investment as a positive sign.
The details of these transactions were disclosed in a Form 4 filing with the Securities and Exchange Commission, dated July 25, 2024. Texas Capital Bancshares, headquartered in Dallas, Texas, operates as a commercial bank and is a significant player in the financial services industry.
In other recent news, Texas Capital Bancshares has reported a robust Q2 2024, with a significant increase in net income to common shareholders by 71% quarter-over-quarter. The firm's total revenue rose by 4% to $267 million, while adjusted pre-provision net revenue jumped 24% to $79 million. The bank's tangible common equity to tangible assets ratio stood at a leading 9.6%, and it saw a 21% increase in fee income quarter-over-quarter.
Texas Capital Bancshares also announced a share repurchase of $50 million during the quarter. The bank's tangible book value reached an all-time high of $62.23 per share, a 7% year-over-year increase. However, loan growth has been slower than anticipated due to clients' reduced appetite for bank credit.
The firm anticipates low to mid-single-digit revenue growth and plans to resume quarterly PPNR growth in Q4. Despite slower loan growth, the company remains confident in its ability to meet its future targets and continue its momentum. These are the recent developments for Texas Capital Bancshares.
InvestingPro Insights
Amidst the recent news of director Robert W. Stallings' purchase of Texas Capital Bancshares Inc. (NASDAQ:TCBI) depositary shares, InvestingPro provides key metrics and insights into the company's financial health and performance. With a market capitalization of $3.06 billion and a price-to-earnings (P/E) ratio of 23.78, Texas Capital Bancshares is navigating the competitive financial sector landscape. The adjusted P/E ratio over the last twelve months as of Q2 2024 stands slightly lower at 23.13, reflecting the company's earnings relative to its share price.
An important metric for investors to consider is the Price to Book (P/B) ratio, which for Texas Capital Bancshares is 1.06 as of Q2 2024. This suggests that the market values the company at a slight premium over its book value. Additionally, the company's operating income margin during the same period was 27.49%, indicating a robust ability to convert revenue into actual profit.
InvestingPro Tips highlight that while 11 analysts have revised their earnings downwards for the upcoming period, they also predict that the company will be profitable this year. Moreover, Texas Capital Bancshares has been profitable over the last twelve months and does not pay a dividend to shareholders, which could be appealing to growth-focused investors. For a deeper dive into the company's financials and additional insights, users can explore the 4 additional InvestingPro Tips available on the platform. Don't forget to use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
While the purchase of preferred stock by an insider such as Stallings is a noteworthy event, these InvestingPro metrics and tips provide a broader context for investors considering the company's stock. With a fair value estimate from analysts at $67 and InvestingPro's own fair value calculation at $57.33, investors have valuable information at their disposal to assess the potential and direction of Texas Capital Bancshares.
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