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Fundamental analysis: CapStar Financial Holdings, Inc. (CSTR)

Awarener score: 6.2

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 6.0

• Business has been growing at a good pace. It's been more than average in relation to peer companies.
• CapStar Financial Holdings, Inc. business trend isn't so stable. The higher the stability, the lower the risk. It looks worse than most rivals.

Margins score: 7.5

• CSTR profit margins -on goods and services sold- are usually very poor. They stand better than most rival companies.
• Business profit on sales tends to be hardly sufficient. It's weak when measured against competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually excellent. They remain close to average when compared to peers.
• Earnings -before income taxes and interests on loans taken- tend to be huge in relation to total revenues. They're still slightly better than similar companies.
• Profits -before income taxes- are usually excellent considering total sales, and remain below average when measured against rivals.
• Total net profit tends to be excellent when confronted to sales. Company stands below average when measured against comparable firms.

Growth score: 8.3

• CapStar Financial Holdings, Inc. profit -on goods and services sold- has been growing at an excellent pace. It's been lacking compared to competitors.
• There is not sufficient data to estimate the operating income margin trend, which has been therefore unknown against comparable firms.
• Profits -available to repay debt and purchase properties- have been growing at a very good pace, which compares top tier when measured against peer enterprises.
• Earnings -before income taxes and interests on loans taken- have been growing at a very good tempo. It turns to be impressive in relation to similar stocks.
• In past years, profits -before income taxes- grew at an excellent speed. It was top-notch against rivals.
• In the previous years, growth trend on total net profit has been excellent, and top tier when measured against peer companies.
• Earnings per share have grown at a good rhythm in past years. It's been excellent in relation to industry peers.

Miscellaneous score: 6.0

• CSTR had to pay sparse income taxes in relation to profits made in the past years. It's been somewhat better than peers.
• The company does not report R&D expenses. It's meaningless to measure in relation to competitors.
• We have insufficient data to estimate how effective is research and development effort. It stands unknown against rival companies.

Profitability score: 7.0

• CapStar Financial Holdings, Inc. usually gets sufficient returns on the resources it controls. It proves encouraging in relation to peer firms.
• The company normally gets excellent proceeds -on the resources directly invested in the business-. They remain in good shape compared to similar companies.
• Profitability -in relation to owned resources- is usually quite good. It ranks below average when measured against competitors.
• In the past, got sufficient returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's similar to comparable enterprises.

Usage of Funds score: 3.6

• CSTR on average doesn't generate genuine funds, so to buy or replace property, plants and equipment must either burn existing cash or increase debt. It stands similar to rival firms.
• The company is usually replacing the property, plant, and equipment that gets old, keeping its operating capabilities up to date, which is encouraging in relation to industry peers.
• In the past twelve months it paid some dividends, considering the current stock price. It came somewhat worse than competitors.
• Has greatly increased dividend payments in the past years. Business prospects are most likely good. The company has behaved excellent in relation to similar firms.
• The company generates very few genuine funds. Dividend payments are usually on borrowed money, which isn't sustainable in the long run. Unless business prospects improve greatly, future payments could be at risk. Sustainability looks bottom tier against comparable companies.
• The company usually significantly enlarges the pool of investors, resulting in more mouths feeding on the pie of profits. It remains in a very weak position compared to peer enterprises.
• Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands a disappointment compared to rivals.
• The company generates very few genuine funds. Investor rewards must be paid burning existing cash or by borrowing money, which isn't sustainable in the long run. Unless business prospects improve greatly, stockholder compensation could be at risk. It still looks last-in-rank when measured against competitors.

Balance Sheet score: 6.4

• CapStar Financial Holdings, Inc. intangible assets (like brands and goodwill) represent a small portion of resources controlled, according to accounting books. It isn't that a significant risk of liquidating them if the company ever gets in financial distress. It happens to be almost average when measured against peer companies.
• Current ratio remains a mystery, as there was not sufficient Balance Sheet information. It turns to be unidentifiable against similar firms.
• All resources are company owned, with virtually no financial debt. Financial position is outstanding. The company could significantly borrow money if it wished so, to reinvest in business, to buy a smaller company or to reward stockholders. It remains better than most rival firms.
• Controlled resources might be only very slowly turned into cash and equivalents, which is riskier. It looks almost average when measured against rivals.
• Quick ratio is unavailable at this moment, due to lacking data. It's a pity we cannot compare it with peer firms.
• A conclusion on cash ratio could not be reached, as we lack inputs, which is unfortunate when trying to measure against similar enterprises.
• Usually, sales are on a month credit. It still ranks similar to peers.
• Days of inventory outstanding are not known. It comes up as a big question mark against competitors.
• We could not gauge the normal operating cycle of the company. It happens to be a mystery against peers.
• Unfortunately, we had not enough data to estimate the days of payables outstanding. It ranks unknown against industry peers.
• Cash conversion cycle remains unknown, due to not having enough inputs. It's incomparable against similar companies.
• Company earns net interest income on its investments and therefore is in a quite comfortable financial position. It stands top-notch against rival firms.
• There is insufficient data to conclude on the relationship of EBITDA and debt for this company. It ranks unknown against comparable enterprises.
• Revenues are reasonable in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks in good shape compared to similar firms.
• Resources exploitation is virtually zero, as the firm hardly reports any sales. It's still somewhat better than peer companies.

Valuation score: 7.7

• CapStar Financial Holdings, Inc. looks very cheap in relation to profits and financial position. It happens to be encouraging in relation to competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains a slight improvement compared to peers.
• In the past twelve months, the company generated extraordinary free funds in relation to the stock price, which stands somewhat better than similar companies.
• The company usually consumes plenty more funds than can genuinely generate. Business needs are meet by borrowing money or consuming preexistent cash, which can only keep up until a certain limit. Unless the company is driving outstanding business growth, genuine profitability may be brought into question. It's still below average when measured against industry firms.
• In the past twelve months, the company has slightly rewarded investors, considering both dividends and share on the pie of earnings. It came up close to average when compared to peer ventures.
• This company is a cash hoarder. It might be well poised to substantially increase stockholder payments, or to fund new business projects. It looks slightly better than similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation looks cheap. Possible reasons are that the market might be betting current earnings will be hard to sustain through time, or that the company has very high fund needs, or a weak financial position, among others. If that isn't the case, the current stock price might be attractive. It ranks encouraging in relation to peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a high relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks close to average when compared to rival firms.
• The relation between the stock price and accounting book value might be more than reasonable. It's important both to check this metric through time and to compare it with rival companies. The company remains somewhat better than peer firms.
• In the past twelve months, the operating business earned huge money when compared to the current stock price and financial position. It happens to be encouraging in relation to industry peers.
• In an alternate metric of bang for the buck, the company has usually shown an extreme earnings power ability when measured against the current stock price and financial position. Further analysis is recommended, as the stock might currently be significantly undervalued. It's still a slight improvement compared to peer companies.

Total score: 6.6

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Awarener score: 6.2

Conclusion

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