Will Cullen/Frost Bankers (CFR) be Able to Withstand Short Term Volatility?
Aristotle Capital Management, LLC, an investment management company, released its “Value Equity Strategy” first quarter 2023 investor letter. A copy of the same can be downloaded here. In the first quarter, the fund returned 3.88% gross of fees (3.82% net of fees), outperforming the Russell 1000 Value Index’s 1.01% and underperforming the S&P 500 Index’s 7.5% return. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Aristotle Capital Value Equity Strategy highlighted stocks like Cullen/Frost Bankers, Inc. (NYSE:CFR) in the first quarter 2023 investor letter. Headquartered in San Antonio, Texas, Cullen/Frost Bankers, Inc. (NYSE:CFR) is a bank holding company for Frost Bank. On June 20, 2023, Cullen/Frost Bankers, Inc. (NYSE:CFR) stock closed at $110.89 per share. One-month return of Cullen/Frost Bankers, Inc. (NYSE:CFR) was 7.66%, and its shares lost 6.41% of their value over the last 52 weeks. Cullen/Frost Bankers, Inc. (NYSE:CFR) has a market capitalization of $7.141 billion.
Aristotle Capital Value Equity Strategy made the following comment about Cullen/Frost Bankers, Inc. (NYSE:CFR) in its first quarter 2023 investor letter:
"Cullen/Frost Bankers, Inc. (NYSE:CFR), the Texas‐based bank, was the largest detractor for the period. Given the heightened levels of uncertainty after the collapse of SVB and Signature Bank, regional banks were scrutinized as potential vulnerabilities within the U.S. banking system. Despite the recent events, we remain confident in Cullen/Frost’s ability to withstand short‐term volatility based on itslong and proven history and strong capital position. Since the company’s inception in 1868, Cullen/Frost has employed a conservative strategy and a client service‐centric model that allowed it to be the only Texas bank to survive the 1980s Texas banking collapse, oil crisis and real estate market crash without federal assistance or a takeover, and it was also the first bank to decline TARP (Troubled Asset Relief Program) bailout funds during the Global Financial Crisis of 2008. Cullen/Frost continues to utilize this strategy, with a relatively low loan‐to‐deposit ratio of 38% and current capital ratios in excess of well‐capitalized levels. The company’s strong balance sheet management and steady, relationship‐based approach have led to consistent levels of profitability and 29 consecutive years of dividend increases. We believe Cullen/Frost remains in a strong position to navigate the current short‐term environment, continue to win market share in areas such as Houston and Dallas, and generate returns for shareholders in the long run."
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Cullen/Frost Bankers, Inc. (NYSE:CFR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held Cullen/Frost Bankers, Inc. (NYSE:CFR) at the end of first quarter 2023 which was 28 in the previous quarter.
We discussed Cullen/Frost Bankers, Inc. (NYSE:CFR) in another article and shared the list of best May dividend stocks to buy. In addition, please check out our hedge fund investor letters Q1 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
