$61.50
$110.86
bear $61.50
base $91.61
bull $110.86
margin of safety $50.00
market price* $73.03
Hancock Whitney is a Gulf South regional bank holding company headquartered in Gulfport, Mississippi. Hancock Whitney Bank runs roughly 180 offices across Mississippi, Alabama, Louisiana, the Florida panhandle and central Florida, east and north Texas, Nashville and Atlanta, and the company also has sizeable trust, asset management and insurance activities, enlarged by the May 2025 purchase of Sabal Trust Company in St. Petersburg, Florida (about $3 billion of assets under management). At the end of 2025 it had $35.5 billion of assets, $24.0 billion of loans and $29.3 billion of deposits. Loans grew 3% in 2025 while deposits slipped 1%. How we measure earnings. For a bank, deposits and wholesale funding are the raw material of the business, so we value the earnings left for shareholders after interest and after all costs, with no separate deduction for borrowings (the holding company's own long-term debt is only about $194 million). Per diluted share on that basis: 2016 $1.92, 2017 $2.54, 2018 $3.79, 2019 $3.78, 2020 -$0.52, 2021 $5.32, 2022 $6.07, 2023 $4.54, 2024 $5.32, 2025 $5.69. Each ties within a few percent to reported diluted EPS. The pattern is the story: in 2020 the bank set aside $603 million for credit losses (against $48 million in 2019), mostly for energy and pandemic exposure, and a year of profit disappeared even though earnings before provisions actually rose to about $478 million from $440 million. In 2015-2016 the oil downturn also pushed provisions up to $73 million and $111 million from $36-59 million in the normal years that followed, holding earnings to about $1.68 and $1.92 per share. Credit, not operations, is what has hurt this company twice in ten years. Against that, 2021 and 2022 were flattered by reserve releases (a negative provision of $77 million in 2021 and $28 million in 2022), so we do not treat them as normal. Starting level. We set the starting level at the median of 2023-2025, $5.32 per share, which includes a pressured 2023 (deposit costs jumped) and excludes the reserve-release years and the 2020 loss. That is below 2025's $5.69, deliberately. The first half of 2026 reported $2.12 per share, but that includes a $98.5 million pre-tax ($0.93 per share) loss on a January 2026 restructuring in which the bank sold $1.5 billion of securities yielding 2.49% and reinvested in securities yielding 4.35%; the second quarter alone earned $1.55 per share versus $1.32 a year earlier. The restructuring is already done and the company disclosed it adds about $23.8 million a year to net interest income, roughly $0.23 per share. That uplift is the only item we add to the starting level in the base case. Other facts supporting stability: net charge-offs were 0.22% of loans in 2025 (0.19% in 2024, 0.27% in 2023), criticized commercial loans fell 14%, nonaccrual loans rose 10%, the net interest margin was 3.47%, the efficiency ratio under 55%, the common equity tier 1 ratio 13.65% and tangible common equity 10.06% of assets, tangible book value $42.16 per share, no preferred stock, and the dividend was raised 11% to $0.50 a quarter in January 2026. The company repurchased 4.3 million shares in 2025 and a further $141 million in the first half of 2026; diluted shares fell to about 81.5 million. Base case ($91.61 per share). Year one earnings are $5.66: the $5.32 starting level grown 2% plus the $0.23 securities restructuring benefit, a 6.4% rise over the starting level versus 7.0% actual growth in 2025 (so year one starts below the trailing rate; the dated reason for the step is the completed January 2026 restructuring). After that, earnings grow 2% a year through year five and 1.5% through year ten, reaching about $6.60. We credit only growth the bank has already shown: total assets grew about 2.5% a year from 2019 to 2025 and loans 3% last year; we do not credit new Texas centers (four planned in 2026 in the North Dallas area), better margins, further buybacks or fee growth from Sabal. Only the part of earnings not needed to keep capital in step with that growth is counted as available to owners. The base case also carries an oil-bust-sized credit episode in years five and six (about $0.55 and $0.80 per share of extra loss cost, scaled from 2015-2016 to today's larger balance sheet). Beyond year ten we hold earnings flat, not growing, and reduce them by 12% to reflect what credit cycles have actually cost the company over 2015-2025 (net of reserve releases). What keeps earning power going is the deposit franchise: about a third of deposits pay no interest and the bank has operated through multiple cycles. The bank's borrowings are already reflected in its earnings, so no separate debt is deducted. Bear case ($61.50). Earnings sit at the 2023 level of $4.54 per share with no growth, and in years three to five the bank suffers a credit cycle larger than 2020: provisions of 2.7%, 1.5% and 0.6% of today's loans in successive years (the 2020 provision was about 2.7% of loans; here that is followed by two more heavy years, roughly $1 billion of losses above normal in total), with earnings before provisions 8% lower. Per-share earnings go to -$1.58 in year three, $1.21 in year four and $3.31 in year five, then recover; a smaller oil-bust-style episode follows in years eight and nine, and the long-run level is cut by 12% for future cycles. Capital would stay above regulatory requirements, as it did in 2020 when the bank paid its dividend and did not need to issue equity. The bear value is above tangible book value of $42 because even in this case the franchise earns roughly $4.5 per share in normal years on about $3.4 billion of tangible equity, and the bank's earnings before provisions held up through 2020; we did not model anything harsher, such as a forced equity raise at low prices, because nothing in the filings names a concentration that would justify it. Bull case ($110.86). Starting from 2025's proven $5.69, plus the $0.23 restructuring benefit, earnings grow 4% a year for five years and 3% for the next five, reaching $8.34, with no major credit cycle and only a 6% long-run haircut. Four percent sits at the upper end of the 2.5% (2019-2025) to 4.5% (2015-2025, which includes the effect of any acquisitions) annual growth in assets; it assumes the loan growth of 2025 continues and that the new North Dallas centers and the Sabal trust business contribute at the pace shown so far. What we left out and what could make this wrong. Excess capital (the common equity tier 1 ratio of 13.65% is well above the 6.5% well-capitalized threshold) is not valued separately, nor are acceleration of buybacks or margin gains. Earnings for 2026 include a one-time $0.93 charge that we do not count against the long-run level. The assumptions most likely to be wrong: the level of credit costs (the 2016 and 2020 experiences show how fast they can change), deposit costs and the net interest margin if rates move materially, and the pace of loan growth in a deposit base that shrank 1% last year. Figures from the quarterly report for the second quarter of 2026 come from the structured data only and we could not read the narrative of that filing. Our previous estimates were prepared on a different basis and are not comparable with these figures. Margin-of-safety price: $50. We are fairly sure of the earnings level, since the last three full years were $4.54, $5.32 and $5.69 and the second quarter of 2026 is consistent, but less sure of what credit will cost over ten years, because it erased a year of profit in 2020 and held earnings down in 2015-2016. The worst plausible outcome is a repeat of 2020 or worse: the bank has little debt, no preferred stock and strong capital, so it would survive, but shareholders would lose roughly two years of earnings and the dividend would be stretched. If we are wrong about credit costs, the shares are worth about $61 in the bear case; if loan and deposit growth disappoints, earnings stay flat near $5.3-5.7 per share instead of growing. The price assumes a holding period of about five years, during which the company pays a $2.00 annual dividend and returns more through repurchases. The margin-of-safety price is $50 because that is close to 1.2 times tangible book of $42.16, the bear case value sits materially above it, and from that price the base case implies about a 20% annual return over five years once dividends are included and the shares come to reflect the business's value. At materially higher prices the bear case implies little or no return, and the 20% target would depend on everything going right.