Cadence Bank (CADE): Valuation Insights as Rate Cut Hopes Lift Banking Sector Confidence

Recent remarks from New York Federal Reserve President John Williams about possible rate adjustments sent banking stocks higher. Cadence Bank (CADE) saw its shares climb, which points to investor optimism despite ongoing questions around loan quality across the sector.

See our latest analysis for Cadence Bank.

Cadence Bank’s share price is showing renewed momentum, gaining 8.6% over the past month and now up 17.6% year-to-date. That rally was sparked by excitement around possible interest rate cuts and lower short interest. Total shareholder return over the past year was a more modest 5.9%, with longer-term holders enjoying a striking 79% return over five years.

If rate-driven rallies have you curious about what else is catching investors’ attention, now’s a great time to discover fast growing stocks with high insider ownership

With shares trading just below analyst targets and recent momentum fueled by rate cut hopes, is Cadence Bank still undervalued or are investors already factoring in all of its future growth potential?

Most Popular Narrative: 7.2% Undervalued

Cadence Bank’s most-followed valuation narrative sets a fair value of $42.70, which is roughly 7% above the last close of $39.62. The stage is set for a debate: does the bank’s projected growth truly support that premium?

The ongoing expansion in high-growth Sunbelt markets, particularly Texas and Georgia, continues to drive robust organic loan and deposit growth, supported by population inflows and business activity. This should underpin sustained revenue and net interest income expansion.

Read the complete narrative.

Do you want to see what ambitious forecasts are powering this price target? Behind the headline, bold growth assumptions and future margins are shaping this fair value. Uncover the surprising financial projections and find out why the valuation could turn heads on Wall Street.

Result: Fair Value of $42.70 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, slowing economic conditions in Texas or hurdles with recent acquisitions could limit Cadence Bank’s growth. These factors may challenge today’s optimism around the share price.

Find out about the key risks to this Cadence Bank narrative.

Another View: Multiples Say the Shares Look Pricey

While the main valuation narrative sees Cadence Bank as undervalued, a glance at its price-to-earnings ratio tells a different story. The shares trade at 14.2 times earnings, noticeably higher than the industry average of 11.2 and above the fair ratio of 13.3. This suggests investors are already paying a premium, which could raise the bar for future growth. Could this premium signal opportunity, or does it expose investors to greater downside risk if growth expectations are not met?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Cadence Bank Narrative

If you want to dig deeper or see things from a different angle, it only takes a few minutes to shape your own fair value case. Do it your way

A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding Cadence Bank.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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