Hilltop Holdings (HTH): Should You Buy, Sell, or Hold After Q4 Results?

Hilltop Holdings: Recent Performance and Market Comparison

Currently, Hilltop Holdings is trading at $38.82 per share, closely mirroring the broader market’s movement with a 10.1% gain over the past six months. In comparison, the S&P 500 has risen by 7.2% during the same period.

Should you consider adding Hilltop Holdings to your portfolio now, or is caution warranted?

Reasons We’re Cautious on Hilltop Holdings

At this time, we’re not optimistic about Hilltop Holdings. Here are three key concerns, along with an alternative stock we prefer.

1. Net Interest Income Stagnation

Our analysis indicates that investors prioritize consistent growth in a bank’s net interest income, as opposed to one-off fee revenues, which are less reliable. Over the past five years, Hilltop Holdings’ net interest income has remained unchanged, underperforming the banking sector as a whole. On a positive note, the company’s lending division has fared better than its other segments.

2. Efficiency Ratio Set to Worsen

While revenue growth is important, true value comes from profitability. For banks, the efficiency ratio—non-interest expenses divided by total revenue—measures how well costs are managed. Investors focus on the direction of this ratio, not just the number itself, since different revenue streams affect expenses differently. A lower efficiency ratio means better cost control relative to income.

Looking ahead, analysts expect Hilltop Holdings’ efficiency ratio to deteriorate, rising to 85.4% over the next year from 53.1% previously, signaling weaker profitability.

3. Declining Earnings Per Share

Examining long-term earnings per share (EPS) trends reveals whether a company’s additional sales are translating into profit. For Hilltop Holdings, EPS has dropped by an average of 15% annually over the last five years—outpacing the decline in revenue. This suggests the company’s fixed costs have made it difficult to adapt to lower demand.

Our Verdict

Hilltop Holdings does not meet our standards for quality at this time. Despite trading at 1× forward price-to-book (P/B) ratio, or $38.82 per share, the current valuation already reflects a high degree of optimism. There are more attractive opportunities available. We recommend considering a reliable industrials company that stands to benefit from ongoing upgrades.

Alternative Stocks to Consider

Although the market has surged this year, just four stocks are responsible for half of the S&P 500’s total gains—a level of concentration that raises concerns among investors. While many chase the same popular names, savvy investors are seeking quality in overlooked areas, often at much lower prices. Explore our curated list of Top 5 Strong Momentum Stocks for this week, featuring high-quality picks that have delivered a 244% return over the past five years (as of June 30, 2025).

Our selections include well-known leaders like Nvidia, which soared 1,326% from June 2020 to June 2025, as well as lesser-known companies such as Comfort Systems, which achieved a 782% five-year return. Discover your next potential winner with StockStory today.