Third Coast (TCBX) Q4 2025 Earnings Transcript

TCBX is transitioning from a clean operating story to a more interesting “earnings quality” story. The key nuance is that management is explicitly guiding away from several quarter-specific boosts: if fee lift normalizes and deposit inflows cool seasonally, near-term core earnings should step down even if headline revenue stays strong. That makes the stock less about the just-reported print and more about whether the franchise can compound through mix shift, especially noninterest-bearing deposits and relationship-driven fee capture.

The second-order bullish angle is balance sheet optionality. By repeatedly using securitization and dynamic pricing, management is effectively converting concentration limits into lending capacity; that can extend C&I/construction growth longer than the market may expect, but it also raises the odds of more front-loaded fee income and a lumpier quarterly profile. In other words, this is a bank with improving underwriting but increasingly non-linear reported margin, which should support the multiple on forward earnings only if investors trust the medium-term run-rate, not the next quarter.

The contrarian risk is that consensus may be underestimating how much of the 2026 setup is already in the stock: deposit growth was helped by seasonality, and management is telegraphing expense growth in the high-single-digit range just as margin reverts toward the low-3.9%s absent one-offs. If Keystone closes on schedule, the market may initially celebrate scale, but the integration burden plus hiring could suppress ROA progression for several quarters before any synergy shows up. That creates a classic small-bank M&A pattern: good long-term franchise, but potentially a better entry after the first post-close reset in margins and expenses.