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What Is Southside Bancshares's (NASDAQ:SBSI) P/E Ratio After Its Share Price Tanked?

Simply Wall St

To the annoyance of some shareholders, Southside Bancshares (NASDAQ:SBSI) shares are down a considerable 31% in the last month. Even longer term holders have taken a real hit with the stock declining 26% in the last year.


View our latest analysis for Southside Bancshares

How Does Southside Bancshares's P/E Ratio Compare To Its Peers?

We can tell from its P/E ratio of 11.40 that there is some investor optimism about Southside Bancshares. As you can see below, Southside Bancshares has a higher P/E than the average company (9.7) in the banks industry.

NasdaqGS:SBSI Price Estimation Relative to Market, March 13th 2020

That means that the market expects Southside Bancshares will outperform other companies in its industry. Shareholders are clearly optimistic, but the future is always uncertain. So investors should delve deeper. I like to check if company insiders have been buying or selling.

How Growth Rates Impact P/E Ratios


Southside Bancshares saw earnings per share improve by -4.1% last year. And it has bolstered its earnings per share by 18% per year over the last five years.




How Does Southside Bancshares's Debt Impact Its P/E Ratio?

Southside Bancshares's net debt is considerable, at 127% of its market cap. This is a relatively high level of debt, so the stock probably deserves a relatively low P/E ratio. Keep that in mind when comparing it to other companies.

The Bottom Line On Southside Bancshares's P/E Ratio

Southside Bancshares trades on a P/E ratio of 11.4, which is below the US market average of 13.3. It's good to see EPS growth in the last 12 months, but the debt on the balance sheet might be muting expectations. Given Southside Bancshares's P/E ratio has declined from 16.5 to 11.4 in the last month, we know for sure that the market is significantly less confident about the business today, than it was back then. For those who prefer to invest with the flow of momentum, that might be a bad sign, but for a contrarian, it may signal opportunity.


Of course you might be able to find a better stock than Southside Bancshares. So you may wish to see this free collection of other companies that have grown earnings strongly.

