Pinnacle Financial Partners (PNFP) AI Stock Analysis

• Market Cap: $6.97B
• Dividend Yield: 0.96%
• Average Volume (3M): 649.56K
• Price to Earnings (P/E): 15.1
• Beta (1Y): 1.54
• Revenue Growth: 8.09%
• EPS Growth: -11.31%
• Country: US
• Employees: 3,595
• Sector: Financial
• Sector Strength: 76
• Industry: Banks - Regional
• EPS (TTM): 1.90
• Shares Outstanding: 77,366,730
• 10 Day Avg. Volume: 883,896
• 30 Day Avg. Volume: 649,562
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 5.07
• Price to Cash Flow (P/CF): 4.10
• P/FCF Ratio: 1.40
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $118.63
• Price Target Upside: 22.31% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

Pinnacle Financial Partners benefits from robust financial performance with strong revenue and profit growth, effective debt management, and cash flow generation. While the technical indicators suggest caution with a bearish trend, the company's reasonable valuation and positive earnings outlook mitigate some concerns. Economic uncertainties and non-performing asset increases are risks to watch, but the firm's strong growth strategy and recruitment successes position it well for future performance.

Positive Factors

Earnings Performance

EPS of $1.86 topped estimates by 18 cents and consensus by 9 cents reflecting better revenues.

Loan Growth

The next 2-3 year outlook of above peer lender additions is expected to continue supporting notably above peer loan growth trend.

Negative Factors

Expense Growth

Expenses growth is likely to stay elevated, with the incentive compensation accrual up to 90% and likely more upcoming RM hires.

Revenue Guidance

The bottom line shows a revenue beat largely mitigated by weaker guidance and full valuation.

Pinnacle Financial Partners Business Overview & Revenue Model

Company Description

Pinnacle Financial Partners, Inc., together with its subsidiaries, operates as the bank holding company for Pinnacle Bank that provides various banking products and services in the United States. The company accepts various deposits, including savings, checking, noninterest-bearing and interest-bearing checking, money market, and certificate of deposit accounts. Its loan products include commercial loans, such as equipment and working capital loans; commercial real estate loans comprising investment properties and business loans secured by real estate; and loans to individuals consisting of secured and unsecured installment and term loans, lines of credit, residential first mortgage loans, and home equity loans and lines of credit, as well as provides credit cards for consumers and businesses. The company also offers various securities and other financial products; investment products; brokerage and investment advisory programs; and fiduciary and investment management services, such as personal trust, endowments, foundations, individual retirement accounts, pensions, and custody. In addition, it provides insurance agency services primarily in the property and casualty area; merger and acquisition advisory services; and private debt, equity and mezzanine, and other middle-market advisory services. Further, the company offers treasury management, telephone and online banking, mobile banking, debit cards, direct deposit and remote deposit capture, mobile deposit option, automated teller machine, and cash management services. It serves individuals, small to medium-sized businesses, and professional entities. As of December 31, 2020, the company operated 114 offices, including 48 in Tennessee, 36 in North Carolina, 20 in South Carolina, 9 in Virginia, and 1 in Georgia. Pinnacle Financial Partners, Inc. was incorporated in 2000 and is headquartered in Nashville, Tennessee.

How the Company Makes Money

Pinnacle Financial Partners generates revenue primarily through interest income from loans and other earning assets, as well as non-interest income from fees and service charges. The company earns interest income by providing loans to individuals and businesses, including commercial loans, consumer loans, and mortgage lending, which are funded by customer deposits. Non-interest income comes from various sources such as service charges on deposit accounts, fees from investment and wealth management services, and charges related to mortgage banking activities. Additionally, Pinnacle leverages strategic partnerships and acquisitions to expand its service offerings and geographic footprint, contributing to its revenue growth. The company's performance is influenced by factors such as interest rate fluctuations, economic conditions, and regulatory changes in the banking industry.

Pinnacle Financial Partners Financial Statement Overview

Summary

Pinnacle Financial Partners demonstrates strong financial health with robust revenue growth, efficient cost management, and impressive cash generation capabilities. The balance sheet reflects a prudent approach to debt management, while the income statement and cash flow show consistent growth and operational efficiency. Despite some fluctuations in profitability metrics and investment activities, the company is well-positioned for continued financial success in the banking industry.

Income Statement

Pinnacle Financial Partners has shown strong revenue growth with a significant increase in total revenue from $939.86 million in 2019 to $2.70 billion in 2024. The gross profit margin remains robust, as total revenue equals gross profit, indicating well-managed cost structures. The net profit margin has fluctuated slightly but remains healthy. The EBIT margin is impressive, showing operational efficiency. Overall, the company has demonstrated excellent growth and profitability in recent years.

Balance Sheet

The company's balance sheet is strong, with a significant increase in stockholders' equity from $4.36 billion in 2019 to $6.43 billion in 2024. The equity ratio remains stable, indicating a solid equity base relative to total assets. Notably, the company has managed to eliminate total debt by 2024, which reduces financial risk. However, the return on equity shows slight fluctuations, pointing to varying profitability in utilizing shareholder funds over time.

Cash Flow

Pinnacle Financial Partners' cash flow statements indicate a strong ability to generate cash, with operating cash flow increasing significantly over the years. The free cash flow has grown, reflecting efficient capital management. The operating cash flow to net income ratio suggests good cash conversion efficiency. However, fluctuations in investing cash flow highlight varying investment activities, which could introduce volatility to future cash flows.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
2.70B	1.60B	1.40B	1.21B	1.06B
	Gross Profit
2.70B	1.60B	1.40B	1.21B	1.06B
	EBIT
2.67B	895.91M	942.13M	651.90M	371.36M
	EBITDA
0.00	0.00	759.79M	705.16M	416.56M
	Net Income Common Stockholders
475.06M	562.15M	560.74M	527.32M	312.32M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.90B	2.14B	4.70B	8.93B	7.31B
	Total Assets
52.59B	47.96B	41.97B	38.47B	34.93B
	Total Debt
2.30B	2.56B	888.49M	1.31B	1.76B
	Net Debt
-320.32M	419.63M	-257.44M	-2.71B	-1.97B
	Total Liabilities
46.16B	41.92B	36.45B	33.16B	30.03B
	Stockholders Equity
6.43B	6.04B	5.52B	5.31B	4.90B
Cash Flow		Free Cash Flow
904.31M	400.15M	540.58M	634.27M	388.06M
	Operating Cash Flow
904.31M	478.40M	604.92M	657.44M	427.82M
	Investing Cash Flow
-3.67B	-4.60B	-6.68B	-3.61B	-3.57B
	Financing Cash Flow
3.97B	5.18B	3.16B	3.10B	6.58B

Pinnacle Financial Partners Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 96.99
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PNFP, the sentiment is Neutral. The current price of 96.99 is below the 20-day moving average (MA) of 97.32, below the 50-day MA of 105.45, and below the 200-day MA of 105.49, indicating a bearish trend. The MACD of -3.38 indicates Negative momentum. The RSI at 47.43 is Neutral, neither overbought nor oversold. The STOCH value of 75.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PNFP.

Pinnacle Financial Partners Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WTFC	74 Outperform	$7.14B	10.35	11.84%	1.82%	11.51%	7.73%
CFR	73 Outperform	$7.11B	12.48	15.13%	3.38%	7.81%	-2.49%
UMBF	71 Outperform	$6.57B	10.05	13.44%	1.75%	17.28%	25.42%
PNFP	71 Outperform	$6.97B	15.10	7.77%	0.96%	8.09%	-11.31%
CMA	67 Neutral	$6.64B	10.10	10.72%	5.61%	-6.54%	-21.90%
Sector *	63 Neutral	$12.07B	9.35	8.15%	79.57%	12.85%	-5.13%
WAL	59 Neutral	$6.98B	8.92	12.32%	2.31%	13.60%	8.85%

Pinnacle Financial Partners Corporate Events

Pinnacle Financial Partners Approves 2025 Cash Incentive Plan

On February 25, 2025, Pinnacle Financial Partners’ Board of Directors approved the 2025 Annual Cash Incentive Plan, which allows employees to earn cash incentives based on performance metrics such as earnings per share and total revenue goals. The plan, which applies to all salaried and hourly employees, offers payouts ranging from 10% to 125% of base salaries, with adjustments possible based on individual performance evaluations and the discretion of the committee.

Pinnacle Financial Grants Equity Awards to Executives

On January 23, 2025, Pinnacle Financial Partners’ Human Resources and Compensation Committee granted equity awards to its Named Executive Officers under the company’s Second Amended and Restated 2018 Omnibus Equity Incentive Plan. The awards include time-based restricted share units and performance-based restricted share units, which aim to align executive compensation with performance metrics over a three-year period. These awards are designed to incentivize the executives by offering shares of the company’s common stock, contingent on meeting specific performance goals and vesting schedules, potentially impacting the company’s strategic direction and stakeholder interests.