Cadence Bank: Better Growth And Betas, But It Will Get Harder From Here

The early returns from the merger that created the new Cadence Bank (NYSE:CADE) have been mixed - while the bank is performing well operationally, the stock has been lagging the regional banking group and has seen a sharper sell-off over the last week or two. With that, the stock is down more than 20% since my last update, basically doubling the declines of the regional bank group.

While I can understand investor nervousness on the sector to a point, particularly as funding costs start to accelerate and the macro outlook for 2023 starts to deteriorate, but I think the reaction is overdone in this case. With a strong Net Promoter Score (a reflection of customer satisfaction), an attractive geographic footprint leveraged to many growing metro areas, and better-than-average funding and fee-generating bases, I do believe Cadence should be valued more highly than it is today.

 

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Cadence Bank: Better Growth And Betas, But It Will Get Harder From Here