Hilltop (NYSE:HTH) Rating Lowered to "Strong Sell" at Zacks Research

Key Points

• Zacks Research downgraded Hilltop (NYSE:HTH) from a "hold" to a "strong sell."
• Q1 results were mixed: EPS of $0.64 beat estimates on higher net interest income and lower provisions, but consolidated revenue missed expectations (~$300.5M vs. ~$305M), deposits declined ~3.2% YoY and high CRE exposure (~43% of loans) increases downside risk.
• Notable insider activity: insiders sold about 294,796 shares (~$11.2M) last quarter — including CEO and a major shareholder — though insiders still own roughly 29.9% of the stock.

Hilltop (NYSE:HTH - Get Free Report) was downgraded by Zacks Research from a "hold" rating to a "strong sell" rating in a research report issued to clients and investors on Thursday,Zacks.com reports.

A number of other analysts have also recently commented on HTH. Wall Street Zen upgraded Hilltop from a "sell" rating to a "hold" rating in a research report on Saturday. Keefe, Bruyette & Woods boosted their target price on shares of Hilltop from $34.00 to $39.00 and gave the company a "market perform" rating in a research note on Tuesday, February 3rd. Finally, Weiss Ratings reissued a "buy (b)" rating on shares of Hilltop in a research note on Tuesday. One analyst has rated the stock with a Buy rating, two have given a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat.com, Hilltop presently has a consensus rating of "Hold" and an average target price of $37.50.

Hilltop Stock Down 3.4%

NYSE:HTH opened at $36.68 on Thursday. The company has a market capitalization of $2.18 billion, a PE ratio of 13.89 and a beta of 0.92. Hilltop has a 52-week low of $28.43 and a 52-week high of $40.41. The stock has a fifty day simple moving average of $36.81 and a 200-day simple moving average of $35.40.

Hilltop (NYSE:HTH - Get Free Report) last released its quarterly earnings results on Thursday, April 23rd. The financial services provider reported $0.64 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.54 by $0.10. Hilltop had a return on equity of 7.29% and a net margin of 10.13%.The business had revenue of $300.51 million during the quarter, compared to the consensus estimate of $304.87 million. During the same quarter in the previous year, the company posted $0.65 EPS. As a group, equities analysts anticipate that Hilltop will post 2.04 earnings per share for the current year.

Insider Activity at Hilltop

In related news, CEO Steve B. Thompson sold 9,025 shares of the business's stock in a transaction dated Friday, February 6th. The shares were sold at an average price of $39.84, for a total value of $359,556.00. Following the completion of the transaction, the chief executive officer owned 91,817 shares of the company's stock, valued at approximately $3,657,989.28. The trade was a 8.95% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, major shareholder Gerald J. Ford sold 259,771 shares of the business's stock in a transaction dated Thursday, March 5th. The shares were sold at an average price of $37.98, for a total transaction of $9,866,102.58. Following the completion of the transaction, the insider directly owned 7,867 shares of the company's stock, valued at $298,788.66. The trade was a 97.06% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last quarter, insiders sold 294,796 shares of company stock valued at $11,225,619. 29.90% of the stock is owned by insiders.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently modified their holdings of HTH. Millennium Management LLC increased its stake in shares of Hilltop by 236.4% during the 1st quarter. Millennium Management LLC now owns 461,206 shares of the financial services provider's stock valued at $14,044,000 after acquiring an additional 324,108 shares during the last quarter. Two Sigma Investments LP increased its stake in shares of Hilltop by 106.9% during the 3rd quarter. Two Sigma Investments LP now owns 493,802 shares of the financial services provider's stock valued at $16,503,000 after acquiring an additional 255,141 shares during the last quarter. Freestone Grove Partners LP acquired a new position in shares of Hilltop during the 3rd quarter valued at about $8,337,000. Jacobs Levy Equity Management Inc. increased its stake in shares of Hilltop by 37.5% during the 3rd quarter. Jacobs Levy Equity Management Inc. now owns 711,802 shares of the financial services provider's stock valued at $23,788,000 after acquiring an additional 194,287 shares during the last quarter. Finally, Goldman Sachs Group Inc. increased its stake in shares of Hilltop by 32.0% during the 1st quarter. Goldman Sachs Group Inc. now owns 796,277 shares of the financial services provider's stock valued at $24,247,000 after acquiring an additional 192,991 shares during the last quarter. Institutional investors and hedge funds own 57.13% of the company's stock.

Key Stories Impacting Hilltop

Here are the key news stories impacting Hilltop this week:

• Positive Sentiment: Q1 EPS beat expectations — Hilltop reported $0.64 EPS vs. consensus ~$0.54, driven by higher net interest income; management also highlighted improved provision levels. Read More.
• Positive Sentiment: Net interest income rose and credit‑loss provisions plunged, which supported profitability despite headwinds in other areas. This operational improvement is a near‑term positive for margins and earnings. Read More.
• Positive Sentiment: Dividend and capital returns — Board declared a $0.20 quarterly dividend (ex‑div May 8) and the company signaled progress on its capital‑return plan, supporting yield and shareholder returns. Read More.
• Neutral Sentiment: Earnings call and management commentary are available — review the Q1 transcript for color on deposit trends, margin outlook and capital actions (useful for gauging management confidence but no new headline change). Read More.
• Neutral Sentiment: Company slide deck and press release provide detailed metrics (LOAN mix, NPA trends, segment results) for investor modeling. Read More.
• Negative Sentiment: Revenue and non‑interest income missed expectations — consolidated revenue was ~$300.5M vs. consensus ~$305M, and lower non‑interest income trimmed upside versus the EPS beat. Read More.
• Negative Sentiment: Deposit decline and portfolio risks — deposits fell ~3.2% YoY; management/analysts flagged high CRE exposure (about 43% of loans) and rising nonperforming asset ratios, increasing downside risk if local Texas commercial real estate weakens. Read More.

About Hilltop

Hilltop Holdings, Inc NYSE: HTH is a Dallas, Texas–based financial holding company offering commercial banking, mortgage lending and capital markets services through its three primary subsidiaries: PlainsCapital Corporation, PrimeLending and HilltopSecurities. PlainsCapital provides deposit, lending and treasury management solutions to small and mid-sized businesses, professionals and individuals. PrimeLending specializes in home purchase and refinance loans, serving retail, wholesale and correspondent channels.

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