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1. Company Snapshot

1.a. Company Description

Veritex Holdings, Inc.operates as the bank holding company for Veritex Community Bank that provides various commercial banking products and services to small and medium-sized businesses, and professionals.The company accepts deposit products include demand, savings, money market, and time accounts.


Its loan products include commercial real estate and general commercial, mortgage warehouse loans, residential real estate, construction and land, farmland, consumer, paycheck protection program, 1-4 family residential, agricultural, multi-family residential, and consumer loans, as well as purchased receivables financing.The company also provides interest rate swap services; and a range of online banking solutions, such as access to account balances, online transfers, online bill payment and electronic delivery of customer statements, and ATMs, as well as mobile banking, mail, and personal appointment.In addition, it offers debit cards, night depository services, direct deposits, cashier's checks, and letters of credit; treasury management services, including balance reporting, transfers between accounts, wire transfer initiation, automated clearinghouse origination, and stop payments; and cash management deposit products and services consisting of lockbox, remote deposit capture, positive pay, reverse positive pay, account reconciliation services, zero balance accounts, and sweep accounts.


As of December 31, 2021, the company operated 18 full-service branches located in the Dallas-Fort Worth metroplex, and 10 full-service branches in the Houston metropolitan area.Veritex Holdings, Inc.was incorporated in 2009 and is headquartered in Dallas, Texas.

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1.b. Last Insights on VBTX

Veritex Holdings' recent performance was driven by a series of positive developments. The company declared a quarterly cash dividend of $0.22 per share, providing a return to shareholders. Additionally, Veritex announced the dates for its second quarter 2025 earnings release and conference call, indicating transparency and commitment to investor communication. Furthermore, the company's acquisition by Huntington Bancshares Incorporated in a $1.9 billion deal is expected to accelerate Huntington's organic growth initiatives in high-growth Texas markets.

1.c. Company Highlights

2. Veritex Holdings Delivers Strong Q1 2025 Earnings with EPS Beat and Solid Margin Expansion

Veritex Holdings reported a robust first quarter for 2025, exceeding analyst estimates with an EPS of $0.54 compared to the consensus estimate of $0.51. The bank demonstrated strong financial performance, with a net operating profit of $29 million and pre-tax, pre-provision earnings of $43.4 million. The net interest margin (NIM) saw an 11 basis point expansion to 3.31%, driven by effective deposit repricing efforts. Non-interest income also grew 2.4% to $14.8 million, while operating expenses declined by $2.8 million, improving the efficiency ratio to 60.4%. As Terry Earley noted, "Our focus on reducing deposit costs and managing expenses has been a key driver of our improved profitability this quarter."

Publication Date: Apr -23

📋 Highlights
  • Strong Financial Performance: Net operating profit of $29 million, or $0.54 per share, with pre-tax, pre-provision earnings of $43.4 million.
  • Challenging Loan Growth: 5% annualized decrease in loans during Q1, despite gross loan production of $750 million for the quarter.
  • Improved Net Interest Margin: NIM increased 11 basis points to 3.31%, driven by deposit repricing efforts.
  • Shareholder Returns: Quarterly dividend increased by 10% to $0.22 per share, with 377,000 shares repurchased during the quarter.
  • Stable Credit Trends: Non-performing assets rose to $97 million, but net charge-offs were $4 million, with criticized assets decreasing.

Loan Growth and Credit Trends

While loan growth remains challenging, with a 5% annualized decrease in loans during Q1, the bank's gross loan production was a robust $750 million for the quarter and $2.8 billion over the last four quarters, up 130% year-over-year. This positions Veritex well for future growth. Credit trends remain stable, with a decrease in past due loans and criticized assets. However, non-performing assets increased to $97 million, primarily due to two loans in retail and office exposures. Management expects resolutions for these assets by early Q3. Net charge-offs were $4 million, and the full-year forecast remains at 20 basis points.

Capital Management and Valuation

Veritex continues to prioritize capital management, with a 10% increase in the quarterly dividend to $0.22 per share and the repurchase of 377,000 shares during the quarter. Tangible book value per share rose to $22.33, up 13.8% year-over-year. The bank's strong capital position is further reflected in its robust capital ratios and a dividend yield of 3.44%. On a valuation basis, Veritex trades at a Price-to-Tangible Book Value (P/TBV) of 0.79, which is below its historical average, suggesting potential upside for investors. The bank's net debt-to-EBITDA ratio of -5.41 also highlights its strong balance sheet and debt management.

Outlook and Strategic Focus

Looking ahead, Veritex expects loan growth to be flat for the year, with a slight decline in the first half before resuming growth in the second half, driven by a 130% increase in the loan pipeline. Management remains disciplined in its approach, focusing on reducing deposit costs and managing expenses. The bank is also strategically shifting its focus to C&I investments, with the pipeline split approximately two-thirds C&I and one-third CRE. Despite the challenging CRE environment, particularly with ADC payoffs, Veritex is well-positioned to navigate these headwinds due to strong underwriting and high equity contributions. Analysts estimate revenue growth of 6.2% for next year, reflecting confidence in the bank's ability to execute on its strategic initiatives.

3. NewsRoom

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Connor Clark & Lunn Investment Management Ltd. Buys 9,972 Shares of Veritex Holdings, Inc. $VBTX

Nov -17

Source: defenseworld.net

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State of New Jersey Common Pension Fund D Has $2.04 Million Stake in Veritex Holdings, Inc. $VBTX

Oct -30

Source: defenseworld.net

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Veritex (VBTX) Projected to Post Quarterly Earnings on Tuesday

Oct -26

Source: defenseworld.net

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Huntington Strengthens Texas Presence With Veritex Acquisition

Oct -22

Source: zacks.com

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Veritex Holdings, Inc. (NASDAQ:VBTX) Given Average Rating of “Moderate Buy” by Analysts

Oct -22

Source: defenseworld.net

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Veritex Holdings, Inc. (VBTX) Q3 2025 Earnings Call Transcript

Oct -21

Source: seekingalpha.com

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Shareholder Alert: The Ademi Firm investigates whether Veritex Holdings, Inc. is obtained a Fair Price for its Public Shareholders

Oct -21

Source: prnewswire.com

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Huntington Bank Completes Merger with Veritex, Deepening Commitment to Texas

Oct -20

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (12.00%)

6. Segments

Community Banking

Expected Growth: 12%

Veritex Holdings' Community Banking segment growth of 12% is driven by strategic acquisitions, expansion into high-growth markets, and a focus on commercial lending. Additionally, investments in digital banking and customer relationship management have enhanced customer experience, leading to increased deposits and loan growth. Strong credit quality and a favorable interest rate environment have also contributed to the segment's growth.

7. Detailed Products

Commercial Banking

Veritex Holdings, Inc. offers a range of commercial banking services, including cash management, treasury management, and commercial lending, to help businesses manage their finances and achieve their goals.

Mortgage Banking

Veritex Holdings, Inc. provides mortgage banking services, including residential and commercial mortgage lending, to help individuals and businesses finance their properties.

Treasury Management

Veritex Holdings, Inc. offers treasury management services, including account management, payment processing, and fraud prevention, to help businesses manage their finances and reduce risk.

Private Banking

Veritex Holdings, Inc. provides private banking services, including wealth management, investment services, and trust services, to help high-net-worth individuals manage their wealth.

Retail Banking

Veritex Holdings, Inc. offers retail banking services, including checking and savings accounts, credit cards, and personal loans, to help individuals manage their personal finances.

8. Veritex Holdings, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Veritex Holdings, Inc. is medium due to the presence of alternative banking services and financial institutions that offer similar products and services.

Bargaining Power Of Customers

The bargaining power of customers for Veritex Holdings, Inc. is low due to the lack of concentration of customers and the presence of multiple banking options.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Veritex Holdings, Inc. is medium due to the presence of multiple suppliers and the moderate level of dependence on these suppliers.

Threat Of New Entrants

The threat of new entrants for Veritex Holdings, Inc. is high due to the relatively low barriers to entry in the banking industry and the presence of new fintech companies.

Intensity Of Rivalry

The intensity of rivalry for Veritex Holdings, Inc. is high due to the presence of multiple competitors in the banking industry and the high level of competition for customers.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 22.13%
Debt Cost 10.52%
Equity Weight 77.87%
Equity Cost 10.52%
WACC 10.52%
Leverage 28.41%

11. Quality Control: Veritex Holdings, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
First Merchants

A-Score: 6.6/10

Value: 7.3

Growth: 6.1

Quality: 6.4

Yield: 7.0

Momentum: 5.0

Volatility: 7.7

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Third Coast Bancshares

A-Score: 6.6/10

Value: 7.2

Growth: 9.3

Quality: 7.1

Yield: 0.0

Momentum: 9.0

Volatility: 6.7

1-Year Total Return ->

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First Business Financial Services

A-Score: 6.5/10

Value: 7.1

Growth: 7.9

Quality: 5.3

Yield: 4.0

Momentum: 7.0

Volatility: 7.7

1-Year Total Return ->

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Veritex Holdings

A-Score: 6.3/10

Value: 5.4

Growth: 6.4

Quality: 6.4

Yield: 6.0

Momentum: 8.0

Volatility: 5.3

1-Year Total Return ->

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TowneBank

A-Score: 6.1/10

Value: 5.2

Growth: 5.2

Quality: 7.0

Yield: 6.0

Momentum: 5.0

Volatility: 8.3

1-Year Total Return ->

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Financial Institutions

A-Score: 5.9/10

Value: 6.4

Growth: 3.6

Quality: 3.8

Yield: 9.0

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

30.26$

Current Price

30.26$

Potential

-0.00%

Expected Cash-Flows