Cullen/Frost (NYSE:CFR) looks like a good long-term investment which is fairly priced at this time, with an expected average annual return in the 13% range.
I am going to pass because of CFR’s high correlation to the energy sector, where my portfolio is overweight, but for anyone without that problem CFR might reward further research. This Texas bank has enjoyed excellent profit and dividend growth but it is relatively inexpensive compared to some its peers.
CFR has strongly outperformed the S&P, but it has a higher dividend yield and less volatility. In addition to offering the customary banking services through 100 offices all over Texas, the company does international banking business with customers residing in Mexico or doing business with customers in Mexico, sells a variety of insurance products, and acts as a correspondent for other banks in the area.
CFR 1-yr. chart: