Texas Capital Bancshares, Inc.'s (TCBI) second-quarter 2012 operating earnings surpassed the Zacks Consensus Estimate by a nickel. Quarterly results benefited from an increase in the top line aided by an augmentation of both net interest income as well as non-interest income, partially offset by higher expenses. Separately, the company announced a public offering of $1.75 million shares of common stock. Proceeds from this offering would be used by Texas Capital for its business and capital support.
The company's business model remains a chief growth driver. The gain in market share from its competitors and organic growth is impressive. Its efforts to hire experienced bankers and expand its presence are encouraging.
Our six-month target price of $49.00 equates to 17.0x our earnings estimate for 2012. This price target implies an expected total return of 19.9% over that period, which is consistent with our Outperform recommendation on the shares.
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