JPMorgan Chase says a regional bank is attractive enough to catch the attention of the late Charlie Munger. “When we think of the late, great Charlie Munger and his mantra of ‘buying great businesses at a fair price,'” Steven Alexopoulos, a banking analyst at the firm, said in a note , one bank we think fits that bill is Cullen Frost, Berkshire Hathaway’s vice chairman, who died in November, a month short of his 100th birthday, early in his career. , Munger broadened Warren Buffett’s approach to investing, ultimately weaning the young Buffett away from buying extremely cheap “cigar butt” companies that might still have a little smoke left in them. Instead, he focuses on quality companies selling at fair prices. On April 25, San Antonio, Texas-based Cullen/Frost Bankers reported lower-than-expected first-quarter earnings, triggering a sharp sell-off in the stock, according to FactSet. However, JPMorgan said the bank’s “strong organic growth story” remained intact. Specifically, analysts said Cullen/Frost’s loan growth continued to grow at an annualized rate of 11% last quarter, while most of its peers stagnated. “We believe CFR’s underperformance is overblown, providing a more attractive buying opportunity in a company that is poised to be a compounding factor driving significant gains in key measures of bank stocks’ long-term performance,” JPMorgan said. The stock fell nearly 7% in April and is down about 3% this year. JPMorgan said investors can buy the stock now at a forward price-to-earnings ratio of 13.1 times, compared with the historical average of 16 times. The bank maintained an overweight rating and set a 12-month price target of $140 per share, a 32% upside from Tuesday’s closing price of $105.62. —CNBC’s Michael Bloom contributed reporting.
