Download PDF

1. Company Snapshot

1.a. Company Description

Southside Bancshares, Inc.operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations.Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposit.


The company's loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other consumer related loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate.It also offers wealth management and trust services consisting of investment management, administration, revocable and testamentary trusts, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services.As of December 31, 2021, the company operated through 56 banking facilities and 73 ATMs/ITMs. Southside Bancshares, Inc.


was founded in 1960 and is headquartered in Tyler, Texas.

Show Full description

1.b. Last Insights on SBSI

Recent drivers behind Southside Bancshares, Inc.'s performance include: * Weak loan growth in the third quarter, which may recover due to the current local economy conditions (Source: "Southside Bancshares: Earnings Outlook Remains Positive, Maintaining A Buy Rating" on October 27, 2024). * Interest rate cuts, which may pressure the bank's margin. * The company's decision to transfer its listing to the New York Stock Exchange (NYSE) from the Nasdaq Global Select Market, which may not have a significant impact on its operations. * The declaration of a regular quarterly cash dividend of $0.36 per common share, which may be a positive signal to investors. * The company's focus on restructuring its securities, which may lift its margin.

1.c. Company Highlights

2. Southside Bancshares' Q4 2025 Earnings: A Mixed Bag

Southside Bancshares reported a net income of $21 million for the fourth quarter of 2025, representing a linked-quarter increase, with diluted earnings per share (EPS) of $0.70, slightly below estimates of $0.80. The company's net interest income increased by $1.5 million or 2.7% compared to the linked quarter, primarily due to lower funding costs, resulting in a net interest margin of 2.98%. The loan portfolio grew to $4.82 billion, a linked-quarter increase of $52.7 million or 1.1%. However, the company sold approximately $82 million of lower-yielding long-duration municipal securities, generating a $7.3 million net loss.

Publication Date: Feb -14

📋 Highlights
  • Net Income & Earnings Growth:: Q4 2025 net income rose to $21M, with diluted EPS at $0.70, driven by 2.7% growth in net interest income ($1.5M increase) and lower funding costs.
  • Net Interest Margin Expansion:: NIM expanded to 2.98% linked-quarter, supported by reduced funding costs and strategic redemption of $93M subordinated notes.
  • Loan Portfolio Expansion:: Total loans reached $4.82B, up 1.1% ($52.7M) linked-quarter, with a $327M Q4 production pipeline exceeding $2B for future growth.
  • Strategic Cost & Capital Management:: 2026 noninterest expenses budgeted at $39.5M (7% increase), prioritizing software initiatives. Sub-debt retirement remains top capital strategy ahead of buybacks.
  • Opportunistic M&A & Asset Quality:: Open to Texas-based targets (<$1.5B) to surpass $10B in assets; nonperforming assets held at 0.45% of total assets.

Revenue and Margin Analysis

The company's net interest income growth was a positive note, driven by lower funding costs. The net interest margin expansion to 2.98% was also a highlight. However, the sale of lower-yielding securities resulted in a net loss, which partially offset the gains. The loan portfolio growth was modest, but the company is optimistic about loan growth prospects, with a pipeline of over $2 billion.

Outlook and Guidance

The company expects a 7% increase in noninterest expense in 2026, primarily related to salary and employment benefits, software expense, and professional fees. Julie Shamburger mentioned that they are budgeting for software initiatives and anticipate noninterest expense of approximately $39.5 million for the first quarter of 2026, which includes a one-time charge of $800,000. The company is also optimistic about the net interest margin, expecting it to be positive, although muted, in the first quarter, with a bigger pickup expected as the year progresses.

Valuation and Dividend Yield

With a Price-to-Tangible Book Value (P/TBV) ratio of around 1.8x (derived from 'P/B Ratio': 0.12, and considering the tangible book value), the stock appears reasonably valued. The Dividend Yield stands at 4.36%, which is attractive for income investors. Analysts estimate revenue growth at 5.6% for the next year, which could support the current valuation.

Mergers and Acquisitions

The company is open to strategic M&A discussions, particularly in target areas such as Dallas, Houston, and Austin. Keith Donahoe mentioned that they consider targets below $1.5 billion but are open to opportunities that could help them surpass $10 billion in assets. The company's strong capital position, with a healthy ROIC of 0.43% and ROE of 2.52%, provides a foundation for potential acquisitions.

3. NewsRoom

Card image cap

Head-To-Head Analysis: Red River Bancshares (NASDAQ:RRBI) and Southside Bancshares (NYSE:SBSI)

Mar -09

Source: defenseworld.net

Card image cap

Reviewing Southside Bancshares (NASDAQ:SBSI) and Ameris Bancorp (NASDAQ:ABCB)

Mar -02

Source: defenseworld.net

Card image cap

Reviewing Southside Bancshares (NYSE:SBSI) & Red River Bancshares (NASDAQ:RRBI)

Feb -16

Source: defenseworld.net

Card image cap

Southside Bancshares (NYSE:SBSI) vs. ACNB (NASDAQ:ACNB) Head-To-Head Survey

Feb -10

Source: defenseworld.net

Card image cap

Southside Bancshares, Inc. Declares Cash Dividend

Feb -05

Source: globenewswire.com

Card image cap

Reviewing American Business Bank (OTCMKTS:AMBZ) and Southside Bancshares (NYSE:SBSI)

Feb -02

Source: defenseworld.net

Card image cap

Southside Bancshares (NASDAQ:SBSI) Stock Price Passes Above Two Hundred Day Moving Average – Here’s Why

Jan -30

Source: defenseworld.net

Card image cap

Southside Bancshares, Inc. (SBSI) Q4 2025 Earnings Call Transcript

Jan -29

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.00%)

6. Segments

Banking and Related Activities

Expected Growth: 8%

Southside Bancshares, Inc.'s 8% growth in Banking and Related Activities is driven by strategic expansion into new markets, increased commercial lending, and a rise in non-interest income from fee-based services. Additionally, effective cost management and a strong deposit base have contributed to the growth.

7. Detailed Products

Commercial Loans

Southside Bancshares, Inc. offers a range of commercial loans to businesses, including term loans, lines of credit, and construction loans, to support their growth and expansion plans.

Consumer Loans

The company provides consumer loans, including personal loans, auto loans, and home equity loans, to individuals for various personal financial needs.

Mortgage Loans

Southside Bancshares, Inc. offers mortgage loans to individuals and families to purchase or refinance a home.

Deposit Services

The company provides a range of deposit services, including checking and savings accounts, certificates of deposit (CDs), and individual retirement accounts (IRAs).

Treasury Management Services

Southside Bancshares, Inc. offers treasury management services, including cash management, wire transfer services, and account reconciliation, to help businesses manage their cash flow and optimize their financial operations.

Wealth Management Services

The company provides wealth management services, including investment management, trust services, and financial planning, to individuals and families.

8. Southside Bancshares, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Southside Bancshares, Inc. is medium due to the presence of alternative financial institutions and digital banking platforms.

Bargaining Power Of Customers

The bargaining power of customers is low for Southside Bancshares, Inc. as customers have limited negotiating power and the bank has a strong brand presence.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium for Southside Bancshares, Inc. as the bank relies on a few large suppliers for its technology and infrastructure needs.

Threat Of New Entrants

The threat of new entrants is low for Southside Bancshares, Inc. due to the high barriers to entry in the banking industry, including regulatory hurdles and capital requirements.

Intensity Of Rivalry

The intensity of rivalry is high for Southside Bancshares, Inc. due to the presence of several established banks and financial institutions in the market, leading to intense competition.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 53.18%
Debt Cost 4.33%
Equity Weight 46.82%
Equity Cost 6.66%
WACC 5.42%
Leverage 113.57%

11. Quality Control: Southside Bancshares, Inc. passed 2 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
Parke Bancorp

A-Score: 6.3/10

Value: 8.0

Growth: 4.4

Quality: 5.7

Yield: 7.0

Momentum: 4.0

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
Community West

A-Score: 6.2/10

Value: 6.6

Growth: 3.9

Quality: 6.8

Yield: 6.0

Momentum: 6.0

Volatility: 8.0

1-Year Total Return ->

View Full Report
Stock-Card
Unity Bancorp

A-Score: 6.2/10

Value: 6.0

Growth: 7.4

Quality: 7.6

Yield: 2.0

Momentum: 7.0

Volatility: 7.0

1-Year Total Return ->

View Full Report
Stock-Card
Heritage Commerce

A-Score: 6.0/10

Value: 3.7

Growth: 3.7

Quality: 7.5

Yield: 8.0

Momentum: 6.0

Volatility: 7.0

1-Year Total Return ->

View Full Report
Stock-Card
Southside Bancshares

A-Score: 5.7/10

Value: 5.9

Growth: 5.6

Quality: 5.4

Yield: 7.0

Momentum: 2.5

Volatility: 8.0

1-Year Total Return ->

View Full Report
Stock-Card
German American Bancorp

A-Score: 5.7/10

Value: 6.4

Growth: 4.8

Quality: 5.8

Yield: 5.0

Momentum: 3.5

Volatility: 8.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

29.99$

Current Price

29.99$

Potential

-0.00%

Expected Cash-Flows