Investment research firm Stephens raised its target stock price for Texas Capital Bancshares (NASDAQ:TCBI) to $114 from the previous $111, while affirming an Overweight rating on the shares. This revised target suggests an upside potential compared to the current trading price of approximately $102.24, with the bank’s stock hovering close to its 52-week peak of $105.36.
The upward revision follows Texas Capital Bancshares’ fourth-quarter 2025 financial report, which surpassed consensus expectations. The strong performance was largely driven by notable gains in net interest income, disciplined cost management, and stable credit quality across the portfolio. Over the last twelve months, the bank achieved diluted earnings per share (EPS) of $6.79, underpinned by total revenues reaching $1.2 billion, reflecting a remarkable year-over-year increase of 38.76%.
Stephens attributed the robust net interest income to increased mortgage warehouse volumes and loan yields in the held-for-investment segment exceeding prior projections. The firm further pointed to the bank’s preliminary outlook for 2026, which anticipates a high-single-digit increase in pre-provision net revenue on a year-over-year basis alongside ongoing enhancement in the return on assets.
However, Stephens highlighted that profitability is expected to reach its lowest ebb in the first quarter of 2026 due to higher expense accruals and seasonal constraints affecting Texas Capital’s investment banking and mortgage business units.
In parallel industry developments, Texas Capital Bancshares’ fourth quarter of 2025 results notably outpaced estimates, registering EPS of $2.08 versus the $1.76 anticipated, translating into an 18.18% earnings surprise. Revenue stood at $327.48 million, slightly exceeding the forecast of $323.29 million.
Following these results, RBC Capital responded by elevating its price target on Texas Capital Bancshares from $105.00 to $110.00, while retaining a Sector Perform rating. RBC Capital cited the solid quarterly performance as the basis for the improved price objective, albeit noting some expected seasonal headwinds.
These earnings results and updated price targets underscore Texas Capital Bancshares’ strong financial trajectory and the recognition by analysts of its continued growth potential amid certain operational challenges.