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GuruFocus Financial Strength Rank measures how strong a company’s financial situation is. It is based on these factors

1. The debt burden that the company has as measured by its Interest coverage (current year).
2. Debt to revenue ratio. The lower, the better
3. Altman Z-score.

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

Financial Strength : 7/10

vs
industry
vs
history
Cash to Debt 0.72
PB's Cash to Debt is ranked higher than
70% of the 1566 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 1.48 vs. PB: 0.72 )
PB' s 10-Year Cash to Debt Range
Min: 0.25   Max: No Debt
Current: 0.72

Equity to Asset 0.15
PB's Equity to Asset is ranked higher than
92% of the 2010 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 0.09 vs. PB: 0.15 )
PB' s 10-Year Equity to Asset Range
Min: 0.07   Max: 0.18
Current: 0.15

0.07
0.18
Interest Coverage 8.15
PB's Interest Coverage is ranked higher than
95% of the 1837 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 1.30 vs. PB: 8.15 )
PB' s 10-Year Interest Coverage Range
Min: 0.51   Max: 8.15
Current: 8.15

0.51
8.15
F-Score: 6
Z-Score: 0.31
GuruFocus Profitability Rank ranks how profitable a company is and how likely the company’s business will stay that way. It is based on these factors:

1. Operating Margin
2. Trend of the Operating Margin (5-year average). The company with an uptrend profit margin has a higher rank.
••3. Consistency of the profitability
4. Piotroski F-Score
5. Predictability Rank•

The maximum rank is 10. A rank of 7 or higher means a higher profitability and may stay that way. A rank of 3 or lower indicates that the company has had trouble to make a profit.

Profitability Rank is not directly related to the Financial Strength Rank. But if a company is consistently profitable, its financial strength will be stronger.

Profitability & Growth : 8/10

vs
industry
vs
history
Operating margin (%) 55.92
PB's Operating margin (%) is ranked higher than
96% of the 2021 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 29.33 vs. PB: 55.92 )
PB' s 10-Year Operating margin (%) Range
Min: 37.16   Max: 55.86
Current: 55.92

37.16
55.86
Net-margin (%) 37.29
PB's Net-margin (%) is ranked higher than
93% of the 2021 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 21.41 vs. PB: 37.29 )
PB' s 10-Year Net-margin (%) Range
Min: 26.27   Max: 37.26
Current: 37.29

26.27
37.26
ROE (%) 9.85
PB's ROE (%) is ranked higher than
81% of the 2031 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 8.59 vs. PB: 9.85 )
PB' s 10-Year ROE (%) Range
Min: 7.09   Max: 17.51
Current: 9.85

7.09
17.51
ROA (%) 1.47
PB's ROA (%) is ranked higher than
93% of the 2034 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 0.80 vs. PB: 1.47 )
PB' s 10-Year ROA (%) Range
Min: 0.91   Max: 1.54
Current: 1.47

0.91
1.54
ROC (Joel Greenblatt) (%) 155.04
PB's ROC (Joel Greenblatt) (%) is ranked higher than
86% of the 2003 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 76.89 vs. PB: 155.04 )
PB' s 10-Year ROC (Joel Greenblatt) (%) Range
Min: 101.68   Max: 213.11
Current: 155.04

101.68
213.11
Revenue Growth (3Y)(%) 7.30
PB's Revenue Growth (3Y)(%) is ranked higher than
89% of the 1740 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 1.20 vs. PB: 7.30 )
PB' s 10-Year Revenue Growth (3Y)(%) Range
Min: 3.5   Max: 23.6
Current: 7.3

3.5
23.6
EBITDA Growth (3Y)(%) 8.60
PB's EBITDA Growth (3Y)(%) is ranked higher than
77% of the 1563 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 6.60 vs. PB: 8.60 )
PB' s 10-Year EBITDA Growth (3Y)(%) Range
Min: 1.1   Max: 32.2
Current: 8.6

1.1
32.2
EPS Growth (3Y)(%) 10.20
PB's EPS Growth (3Y)(%) is ranked higher than
77% of the 1547 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 8.90 vs. PB: 10.20 )
PB' s 10-Year EPS Growth (3Y)(%) Range
Min: 1.7   Max: 28.1
Current: 10.2

1.7
28.1
» PB's 10-Y Financials

Financials


Revenue & Net Income
Equity & Asset
Oprt. Cash Flow & Free Cash Flow

» Details

Guru Trades

Q4 2013

PB Guru Trades in Q4 2013

Steven Cohen 7,629 sh (New)
Paul Tudor Jones 10,684 sh (New)
David Dreman 108,105 sh (+5.94%)
Ken Fisher 749,428 sh (-0.56%)
James Barrow 1,420,245 sh (-1.52%)
» More
Q1 2014

PB Guru Trades in Q1 2014

Jim Simons 167,589 sh (New)
Third Avenue Management 325,374 sh (New)
Ken Fisher 850,113 sh (+13.43%)
David Dreman 108,658 sh (+0.51%)
James Barrow 1,412,525 sh (-0.54%)
Steven Cohen 5,702 sh (-25.26%)
Paul Tudor Jones 4,813 sh (-54.95%)
» More
Q2 2014

PB Guru Trades in Q2 2014

Third Avenue Management 532,553 sh (+63.67%)
Jim Simons Sold Out
Paul Tudor Jones Sold Out
Ken Fisher 848,678 sh (-0.17%)
David Dreman 105,927 sh (-2.51%)
James Barrow 1,364,995 sh (-3.36%)
» More
Q3 2014

PB Guru Trades in Q3 2014

Paul Tudor Jones 3,566 sh (New)
David Dreman 106,015 sh (+0.08%)
Third Avenue Management 532,553 sh (unchged)
Ken Fisher 827,783 sh (-2.46%)
James Barrow 1,325,995 sh (-2.86%)
» More
» Details

Insider Trades

Latest Guru Trades with PB

(List those with share number changes of more than 20%, or impact to portfolio more than 0.1%)

GuruDate Trades Impact to Portfolio Price Range * (?) Current Price Change from Average Current Shares
Third Avenue Management 2014-06-30 Add 63.67%0.25%$57.18 - $67 $ 54.41-10%532553
Third Avenue Management 2014-03-31 New Buy0.42%$60.35 - $66.92 $ 54.41-14%325374
David Dreman 2013-09-30 Reduce -75.14%0.53%$55.12 - $61.63 $ 54.41-8%102043
Ken Fisher 2013-09-30 Add 27.74%0.02%$55.12 - $61.63 $ 54.41-8%753638
David Dreman 2012-06-30 New Buy0.5%$40.01 - $46.52 $ 54.4125%510326
James Barrow 2012-06-30 New Buy0.13%$40.01 - $46.52 $ 54.4125%1541305
Ken Fisher 2012-06-30 New Buy0.07%$40.01 - $46.52 $ 54.4125%591180
Premium More recent guru trades are included for Premium Members only!!
Premium More recent guru trades are included for USA Subscribe Members only!!
» Interactive Charts

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Guru Investment Theses on Prosperity Bancshares, Inc.

Third Avenue Management Comments on Prosperity Bancshares - Jun 20, 2014

The addition of Prosperity Common expanded the Fund’s bank basket to six holdings. Houston-based Prosperity Bancshares (PB) is a bank holding company operating with a traditional community banking mindset, a far cry from the behemoth money center banks that have been exposed as too big to manage, too big to regulate and just plain too conflicted. it appears that management runs a tight ship: the company has been profitable every year since its formation, even during the massive economic downturn in Texas in the late 1980’s and during the 2008/2009 financial crisis. Historically the company has grown by making opportunistic acquisitions of banks and branches around Texas. During 2008, for example, the bank acquired $3.6 billion of deposits and certain assets of Franklin Bank from the Federal Deposit insurance Corporation, as receiver. Management’s wellmanaged, bolt-on acquisition strategy along with superb efficiency and conservative underwriting have produced an enviable track record, with adjusted book value1 compounding at mid-teens rates over the past five, ten and fifteen years. Our analysis suggests that management has an ample runway to continue doing more of the same. prosperity’s operational record, based on asset quality, capital adequacy and profitability recently drew the attention of Forbes Magazine2, which named it as “america’s Best Bank.”

At their present valuation, which approximates 15x 2014 earnings, the shares may not appear obviously undervalued. We note, however, that prosperity’s current earnings power is significantly depressed, we think more temporarily than not, by the presence of a high proportion of low-rate assets, e.g., government securities now on the books. Should interest rates and economic conditions gradually “normalize,” the company’s earning power will undoubtedly grow and the true multiple of earnings will be a much more favorable 12x-13x, per our estimates. Should business conditions remain unchanged in the periods ahead, we believe prosperity Common has limited downside. in spite of the currently depressed earnings, prosperity continues to earn a respectable 8% to 9% return on equity, a reasonable level given the relatively low-risk approach embraced by management.

From Third Avenue Management (Trades, Portfolio)'s second quarter 2014 shareholder letter.

Check out Third Avenue Management,Martin Whitman latest stock trades

Top Ranked Articles about Prosperity Bancshares, Inc.

Third Avenue Management Comments on Prosperity Bancshares
The addition of Prosperity Common expanded the Fund’s bank basket to six holdings. Houston-based Prosperity Bancshares (PB) is a bank holding company operating with a traditional community banking mindset, a far cry from the behemoth money center banks that have been exposed as too big to manage, too big to regulate and just plain too conflicted. it appears that management runs a tight ship: the company has been profitable every year since its formation, even during the massive economic downturn in Texas in the late 1980’s and during the 2008/2009 financial crisis. Historically the company has grown by making opportunistic acquisitions of banks and branches around Texas. During 2008, for example, the bank acquired $3.6 billion of deposits and certain assets of Franklin Bank from the Federal Deposit insurance Corporation, as receiver. Management’s wellmanaged, bolt-on acquisition strategy along with superb efficiency and conservative underwriting have produced an enviable track record, with adjusted book value1 compounding at mid-teens rates over the past five, ten and fifteen years. Our analysis suggests that management has an ample runway to continue doing more of the same. Read more...

Ratios

vs
industry
vs
history
P/E(ttm) 13.00
PB's P/E(ttm) is ranked higher than
85% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 17.80 vs. PB: 13.00 )
PB' s 10-Year P/E(ttm) Range
Min: 11.12   Max: 22.23
Current: 13

11.12
22.23
P/B 1.20
PB's P/B is ranked higher than
76% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 1.33 vs. PB: 1.20 )
PB' s 10-Year P/B Range
Min: 0.76   Max: 2.4
Current: 1.2

0.76
2.4
P/S 4.90
PB's P/S is ranked higher than
66% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 3.56 vs. PB: 4.90 )
PB' s 10-Year P/S Range
Min: 3.2   Max: 6.81
Current: 4.9

3.2
6.81
PFCF 11.30
PB's PFCF is ranked higher than
85% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 9999.00 vs. PB: 11.30 )
PB' s 10-Year PFCF Range
Min: 5.88   Max: 54.17
Current: 11.3

5.88
54.17
EV-to-EBIT 9.31
PB's EV-to-EBIT is ranked higher than
89% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 19.47 vs. PB: 9.31 )
PB' s 10-Year EV-to-EBIT Range
Min: 6.8   Max: 16.6
Current: 9.31

6.8
16.6
PEG 1.49
PB's PEG is ranked higher than
88% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 9999.00 vs. PB: 1.49 )
PB' s 10-Year PEG Range
Min: 0.63   Max: 6.22
Current: 1.49

0.63
6.22
Shiller P/E 16.80
PB's Shiller P/E is ranked higher than
89% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 9999.00 vs. PB: 16.80 )
PB' s 10-Year Shiller P/E Range
Min: 11.26   Max: 28.24
Current: 16.8

11.26
28.24

Dividend & Buy Back

vs
industry
vs
history
Dividend Yield 1.80
PB's Dividend Yield is ranked lower than
59% of the 1876 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 2.32 vs. PB: 1.80 )
PB' s 10-Year Dividend Yield Range
Min: 0.99   Max: 2.49
Current: 1.8

0.99
2.49
Dividend Payout 0.23
PB's Dividend Payout is ranked higher than
83% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 0.61 vs. PB: 0.23 )
PB' s 10-Year Dividend Payout Range
Min: 0.16   Max: 0.45
Current: 0.23

0.16
0.45
Dividend growth (3y) 11.40
PB's Dividend growth (3y) is ranked higher than
85% of the 1127 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 5.50 vs. PB: 11.40 )
PB' s 10-Year Dividend growth (3y) Range
Min: 0   Max: 98.3
Current: 11.4

0
98.3
Yield on cost (5-Year) 3.13
PB's Yield on cost (5-Year) is ranked higher than
60% of the 1889 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 2.53 vs. PB: 3.13 )
PB' s 10-Year Yield on cost (5-Year) Range
Min: 1.72   Max: 4.33
Current: 3.13

1.72
4.33
Share Buyback Rate -9.00
PB's Share Buyback Rate is ranked higher than
59% of the 1472 Companies
in the Global Banks - Regional - US industry.

( Industry Median: -1.80 vs. PB: -9.00 )
PB' s 10-Year Share Buyback Rate Range
Min: -1.1   Max: -25.7
Current: -9

Valuation & Return

vs
industry
vs
history
Price/Tangible Book 3.00
PB's Price/Tangible Book is ranked higher than
63% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 1.58 vs. PB: 3.00 )
PB' s 10-Year Price/Tangible Book Range
Min: 1.77   Max: 5.89
Current: 3

1.77
5.89
Price/DCF (Projected) 0.80
PB's Price/DCF (Projected) is ranked higher than
83% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 5.09 vs. PB: 0.80 )
PB' s 10-Year Price/DCF (Projected) Range
Min: 0.57   Max: 1.51
Current: 0.8

0.57
1.51
Price/Median PS Value 0.90
PB's Price/Median PS Value is ranked higher than
92% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 1.21 vs. PB: 0.90 )
PB' s 10-Year Price/Median PS Value Range
Min: 0.64   Max: 1.22
Current: 0.9

0.64
1.22
Price/Peter Lynch Fair Value 1.40
PB's Price/Peter Lynch Fair Value is ranked higher than
91% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 9999.00 vs. PB: 1.40 )
PB' s 10-Year Price/Peter Lynch Fair Value Range
Min: 0.59   Max: 2.76
Current: 1.4

0.59
2.76
Price/Graham Number 1.30
PB's Price/Graham Number is ranked higher than
69% of the 2636 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 1.15 vs. PB: 1.30 )
PB' s 10-Year Price/Graham Number Range
Min: 1.01   Max: 2.38
Current: 1.3

1.01
2.38
Earnings Yield (Greenblatt) 10.70
PB's Earnings Yield (Greenblatt) is ranked higher than
88% of the 1996 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 6.60 vs. PB: 10.70 )
PB' s 10-Year Earnings Yield (Greenblatt) Range
Min: 6   Max: 14.6
Current: 10.7

6
14.6
Forward Rate of Return (Yacktman) 16.74
PB's Forward Rate of Return (Yacktman) is ranked higher than
75% of the 1246 Companies
in the Global Banks - Regional - US industry.

( Industry Median: 14.25 vs. PB: 16.74 )
PB' s 10-Year Forward Rate of Return (Yacktman) Range
Min: 8.2   Max: 29.9
Current: 16.74

8.2
29.9

Business Description

Industry: Banks » Banks - Regional - US
Compare:MTB, USB, PNC, CFR, MWG » details
Traded in other countries:PPY.Germany,
Prosperity Bancshares, Inc., is a Texas corporation, was formed in 1983 as a vehicle to acquire the former Allied Bank in Edna, Texas which was chartered in 1949 as The First National Bank of Edna and is now known as Prosperity Bank. The Company operates as the financial holding company for Prosperity Bank (the 'Bank'), which provides a line of financial products and services to small and medium-sized businesses and consumers. As of December 31, 2013, the Bank operated 238 full service banking locations; 63 in the Houston area; including The Woodlands; 26 in the South Texas area, including Corpus Christi and Victoria; 35 in the Dallas/Fort Worth area; 22 in the East Texas area; 36 in the Central Texas area, including Austin and San Antonio; 34 in the West Texas area, including Lubbock, Midland-Odessa and Abilene; 16 in the Bryan/College Station area and 6 in the Central Oklahoma area. During 2013, the Company completed three acquisitions including East Texas Financial Services Inc., Coppermark Bancshares, Inc. and FVNB Corp. Combined, these acquisitions added 30 banking centers after consolidation. The company's market consists of the communities served by its banking centers. The diverse nature of the economies in each local market served by the company provides it with a varied customer base and allows it to spread its lending risk throughout a number of different industries including professional service firms and their principals, manufacturing, tourism, recreation, petrochemicals, farming and ranching. The company competes with other commercial banks, savings banks, savings and loan associations, credit unions, finance companies, mutual funds, insurance companies, brokerage and investment banking firms, asset-based nonbank lenders and certain other nonfinancial entities, including retail stores which might maintain their own credit programs and certain governmental organizations which might offer more favorable financing than the company. The company and the bank are subject to regulation, supervision and examination by federal and state banking authorities.
» More Articles for PB

Headlines

Articles On GuruFocus.com
Third Avenue Management Comments on Prosperity Bancshares Jun 20 2014 
Undervalued and Predictable Banks with Yield Aug 06 2013 
Top Insider Buys: BRK.A, PB, CBK Dec 24 2012 

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Prosperity Bancshares' Q3 Earnings Impress, Dividend Up Oct 30 2014
Q3 2014 Prosperity Bancshares Inc Earnings Release - Before Market Open Oct 29 2014
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Prosperity Bancshares, Inc.® Declares Quarterly Cash Dividend Sep 08 2014
PROSPERITY BANCSHARES INC Files SEC form 10-Q, Quarterly Report Aug 06 2014
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Prosperity Bancshares, Inc.® Reports Record Second Quarter 2014 Earnings Jul 25 2014
A Wall Street Transcript Interview with Roger W. Vogel, CFA, Managing Director and Lead Portfolio... Jul 24 2014
Prosperity Bancshares, Inc.® Invites You To Join Its Second Quarter 2014 Earnings Conference Call... Jul 01 2014
Prosperity Bancshares' Inorganic Growth Continues Jun 30 2014
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