NasdaqGS:CSTR

Stock Analysis Report

Capstar Financial Holdings

Executive Summary

CapStar Financial Holdings, Inc. operates as the bank holding company for CapStar Bank that provides banking services to consumer and corporate customers located primarily in Tennessee, the United States.

Rewards

Trading at 33.1% below its fair value

Earnings are forecast to grow 9.74% per year

Earnings grew by 132.2% over the past year

Risk Analysis

High level of non-cash earnings

Unstable dividend track record

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year



Snowflake Analysis

Very undervalued with flawless balance sheet.


Similar Companies

Share Price & News

How has Capstar Financial Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CSTR's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

9.9%

CSTR

2.9%

US Banks

5.3%

US Market


1 Year Return

-36.4%

CSTR

-27.8%

US Banks

-10.7%

US Market

Return vs Industry: CSTR underperformed the US Banks industry which returned -26.4% over the past year.

Return vs Market: CSTR underperformed the US Market which returned -10.4% over the past year.


Shareholder returns

CSTRIndustryMarket
7 Day9.9%2.9%5.3%
30 Day-28.0%-26.3%-13.6%
90 Day-40.6%-39.3%-19.8%
1 Year-35.6%-36.4%-25.6%-27.8%-8.9%-10.7%
3 Year-46.8%-47.9%-17.1%-23.1%15.5%8.0%
5 Yearn/a10.9%-1.7%35.2%20.4%

Price Volatility Vs. Market

How volatile is Capstar Financial Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Capstar Financial Holdings undervalued compared to its fair value and its price relative to the market?

30.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CSTR ($9.5) is trading below our estimate of fair value ($14.21)

Significantly Below Fair Value: CSTR is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CSTR is good value based on its PE Ratio (7.6x) compared to the Banks industry average (8.9x).

PE vs Market: CSTR is good value based on its PE Ratio (7.6x) compared to the US market (13.1x).


Price to Earnings Growth Ratio

PEG Ratio: CSTR is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: CSTR is good value based on its PB Ratio (0.6x) compared to the US Banks industry average (0.8x).


Next Steps

Future Growth

How is Capstar Financial Holdings forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

9.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CSTR's forecast earnings growth (9.7% per year) is above the savings rate (1.7%).

Earnings vs Market: CSTR's earnings (9.7% per year) are forecast to grow slower than the US market (12.2% per year).

High Growth Earnings: CSTR's earnings are forecast to grow, but not significantly.

Revenue vs Market: CSTR's revenue (10% per year) is forecast to grow faster than the US market (7.2% per year).

High Growth Revenue: CSTR's revenue (10% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CSTR's Return on Equity is forecast to be low in 3 years time (7.8%).


Next Steps

Past Performance

How has Capstar Financial Holdings performed over the past 5 years?

24.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CSTR has a high level of non-cash earnings.

Growing Profit Margin: CSTR's current net profit margins (24.6%) are higher than last year (15.5%).


Past Earnings Growth Analysis

Earnings Trend: CSTR's earnings have grown significantly by 24.9% per year over the past 5 years.

Accelerating Growth: CSTR's earnings growth over the past year (132.2%) exceeds its 5-year average (24.9% per year).

Earnings vs Industry: CSTR earnings growth over the past year (132.2%) exceeded the Banks industry 10.9%.


Return on Equity

High ROE: CSTR's Return on Equity (8.2%) is considered low.


Next Steps

Financial Health

How is Capstar Financial Holdings's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: CSTR has a low level of unsold assets or inventory.

Debt Coverage by Assets: CSTR's debt is covered by short term assets (assets are 27.3x debt).


Financial Institutions Analysis

Asset Level: CSTR's level of assets compared to its equity is low.

Allowance for Bad Loans: CSTR has a sufficient allowance for bad loans.

Low Risk Liabilities: CSTR's liabilities are made up of primarily low risk sources of funding.

Loan Level: CSTR has an acceptable proportion of non-loan assets held.

Low Risk Deposits: CSTR's loans are broadly funded by customer deposits.

Level of Bad Loans: CSTR has an appropriate level of bad loans (0.1%)


Next Steps

Dividend

What is Capstar Financial Holdings's current dividend yield, its reliability and sustainability?

2.02%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CSTR's dividend (2.11%) is higher than the bottom 25% of dividend payers in the US market (1.95%).

High Dividend: CSTR's dividend (2.11%) is low compared to the top 25% of dividend payers in the US market (5.4%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, CSTR has been paying a dividend for less than 10 years.

Growing Dividend: CSTR's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (16%), CSTR's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CSTR's dividends in 3 years are forecast to be well covered by earnings (17.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.4yrs

Average management tenure


CEO

Tim Schools (49yo)

0.75

Tenure

Mr. Timothy K. Schools, also known as Tim, is the Chief Executive Officer and Director at CapStar Financial Holdings, Inc. since July 31, 2019 and President since May 13, 2019. Mr. Schools is Director of C ...


Leadership Team

NamePositionTenureCompensationOwnership
Claire Tucker
Founding President & CEO Emerita0.75yrUS$772.23k0.73% $1.3m
Robert Anderson
Secretary4.25yrsUS$634.72k0.23% $408.2k
Christopher Tietz
Chief Credit Officer4.08yrsUS$654.58k0.21% $371.9k
Timothy Schools
President0.75yrno data0.21% $374.6k
Daniel Fox
IR Contactno datano datano data
Derek Wiseman
Senior VP & Human Resources Directorno datano datano data
Mark Mattson
Executive VP & Healthcare Group Managerno datano datano data

2.4yrs

Average Tenure

54.5yo

Average Age

Experienced Management: CSTR's management team is considered experienced (2.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Timothy Schools
President0.75yrno data0.21% $374.6k
Julie Frist
Independent Vice Chairman4.25yrsUS$71.00k3.64% $6.6m
Dennis Bottorff
Independent Chairman of the Board4.25yrsUS$91.50k1.66% $3.0m
Dale Polley
Independent Vice Chairman3yrsUS$75.50k0.26% $470.2k
Toby Wilt
Independent Director12.25yrsUS$55.00k3.09% $5.6m
Stephen Smith
Independent Director12.25yrsUS$52.50k0.29% $517.2k
Lester Bentz
Independent Director12.25yrsUS$58.50k1.31% $2.4m
James Turner
Independent Director12.25yrsUS$62.00k3.73% $6.7m
Thomas Flynn
Independent Director12.25yrsUS$55.00k3.47% $6.3m
Louis Green
Independent Director8.25yrsUS$47.50k0.63% $1.1m

10.3yrs

Average Tenure

64.5yo

Average Age

Experienced Board: CSTR's board of directors are seasoned and experienced ( 10.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CSTR insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 34.7%.


Top Shareholders

Company Information

Capstar Financial Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Capstar Financial Holdings, Inc.
  • Ticker: CSTR
  • Exchange: NasdaqGS
  • Founded: 2007
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$181.064m
  • Shares outstanding: 18.31m
  • Website: https://www.capstarbank.com

Number of Employees


Location

  • Capstar Financial Holdings, Inc.
  • 1201 Demonbreun Street
  • Suite 700
  • Nashville
  • Tennessee
  • 37203
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CSTRNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDSep 2016

Biography

CapStar Financial Holdings, Inc. operates as the bank holding company for CapStar Bank that provides banking services to consumer and corporate customers located primarily in Tennessee, the United States. It offers a range of deposit products and services, including demand deposits, interest-bearing transaction accounts, money market accounts, time and savings deposits, certificates of deposit, and CDARS reciprocal products. The company also provides commercial and consumer real estate, construction and land development, commercial and industrial, consumer, and other loans. In addition, it offers private banking and wealth management services for the owners and operators of business clients and other high net worth individuals; and correspondent banking services to community banks. Further, the company provides telephone and online banking, direct deposit, mobile banking, safe deposit boxes, remote deposit, and cash management services for individuals, and small and medium sized businesses. CapStar Financial Holdings, Inc. was founded in 2007 and is headquartered in Nashville, Tennessee. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 01:26
End of Day Share Price2020/03/31 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.