Central Bancompany (CBC) Net Interest Margin Gain Tests Bullish Profitability Narrative

Central Bancompany (CBC) just wrapped up FY 2025 with Q4 revenue of US$269.2 million and basic EPS of US$0.47, alongside trailing twelve month revenue of US$1.0 billion and EPS of US$1.76 that follow a year in which earnings rose 27.9% and revenue grew 8%. Over the past year, revenue has moved from US$883.1 million to US$1.0 billion while EPS has increased from US$1.39 to US$1.76, setting up this result against a backdrop of higher net profit margins and earnings that are described as high quality. This puts the focus squarely on how durable those margins look heading into the next phase.

See our full analysis for Central Bancompany.

With the headline numbers on the table, the next step is to see how this earnings print lines up with the widely followed narratives around Central Bancompany’s growth, profitability and risk profile, and where those stories might need adjusting.

Curious how numbers become stories that shape markets? Explore Community Narratives

27.9% earnings growth backed by higher margins

• Over the last 12 months, earnings grew 27.9% to US$390.9 million and the net profit margin sits at 38.6% compared with 34.6% a year earlier, meaning more of the US$1.0b in revenue is dropping through to profit than before.
• Supporters of a bullish view often point to this combination of 27.9% earnings growth and a 38.6% margin. The data also shows forecasts stepping down to around 9% annual earnings growth and roughly 8% revenue growth, which is slower than the broader US market and keeps the focus on how repeatable this strong year actually is.
  • That tension, strong trailing figures versus more moderate forward growth of about 9% and 8%, is exactly where bulls need the most conviction.
  • The margin move from 34.6% to 38.6% helps the optimistic side of the story, but the more modest growth forecasts keep expectations in check.

Over the last year, results like a 38.6% net margin and 27.9% earnings growth have pushed optimistic investors to focus on execution quality, even as forward growth expectations stay in the high single digits. 📊 Read the full Central Bancompany Consensus Narrative.

4.23% net interest margin with tighter cost control

• On a trailing 12 month basis, net interest margin sits at 4.23% and the cost to income ratio is 48.7%, compared with 3.88% and 51.7% a year earlier, signaling that the bank is earning more on its loan and securities book while keeping operating costs to a smaller share of income.
• What supports a bullish angle here is that profitability metrics are moving together, with earnings at US$390.9 million on US$1.0b of revenue and a 4.23% net interest margin. The same data also shows total loans sitting around US$11.5b and non performing loans at US$39.5 million to US$50.8 million across the periods, which reminds investors that credit quality and loan mix still matter for how long this level of profitability can last.
  • The higher net interest margin and sub 50% cost to income ratio back the idea of efficient core banking operations.
  • The presence of tens of millions of US$ in non performing loans, even if not unusually large for a bank of this size, gives cautious investors something concrete to track alongside these stronger margins.

P/E premium against peers and DCF gap

• The shares trade on a trailing P/E of 14.7x versus roughly 11x for peers and 11.8x for the wider US Banks industry, while a DCF fair value of US$39.71 and an analyst price target of US$28.90 both sit above the current share price of US$24.06.
• Critics often highlight the 14.7x P/E premium as a bearish talking point, arguing the stock is priced richer than many banks. That view has to be weighed against the 27.9% trailing earnings growth, the 38.6% net margin, and the gap between US$24.06, the US$28.90 analyst target, and the US$39.71 DCF fair value, which together suggest the market is not fully pricing the recent profitability at the same multiples implied by these models.
  • The P/E premium relative to peers fits the cautious argument, yet a lower share price than both the analyst target and DCF fair value pulls in the opposite direction.
  • For investors, the key question is whether earnings growing around 9% a year can justify the 14.7x P/E while the share price trades below both US$28.90 and the DCF fair value of US$39.71.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Central Bancompany's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Central Bancompany’s premium 14.7x P/E multiple, alongside more moderate forward earnings and revenue growth expectations, raises questions about how much upside is already priced in.

If that mismatch between current valuation and future growth targets gives you pause, check out these 877 undervalued stocks based on cash flows to zero in on companies where pricing and fundamentals look more aligned right now.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com