City Holding (CHCO) has wrapped up FY 2025 with fourth quarter revenue of US$79.1 million and basic EPS of US$2.18, while trailing twelve month revenue reached US$315.6 million and EPS came in at US$9.02, pointing to earnings growth of 12.5% over the past year alongside a net profit margin of 41.3%. Over recent periods, revenue has moved from US$291.8 million and EPS of US$7.91 on a trailing basis in Q4 2024 to US$315.6 million and US$9.02 respectively, with quarterly revenue running between US$71.4 million and US$81.8 million and EPS between US$1.94 and US$2.41. With margins higher than a year ago and earnings growth outpacing revenue, this set of results puts profitability quality at the center of the story for investors.

See our full analysis for City Holding.

With the latest earnings now on the table, the next step is to see how these numbers line up with the widely held narratives around City Holding, highlighting where the story is reinforced and where expectations may be challenged.

12.5% Profit Growth Backed By Steady Loan Book

• Over the last twelve months, net income reached US$130.5 million and EPS came in at US$9.02, compared with US$116.0 million of net income and EPS of US$7.91 a year earlier, while total loans sat around US$4.4b through FY 2025.
• Bulls often focus on steady loan books and consistent profit growth, and this set of numbers supports that angle but also adds some nuance:
  • Five year earnings growth averaging 9.3% per year lines up with the latest 12.5% increase, and quarterly EPS in FY 2025 stayed in a tight range between US$2.06 and US$2.41, which fits a bullish view of earnings quality.
  • At the same time, revenue over the last year sat around US$315.6 million, which is described as modest compared with a 3.1% revenue growth expectation versus 10.5% for the wider US market, so the bullish side has to lean more on stability than rapid expansion.

To see how this steady growth story compares with what other investors are saying, you can read the balanced narrative around City Holding and how it interprets these numbers. 📊 Read the full City Holding Consensus Narrative.

41.3% Net Margin Versus Slower Revenue Trend

• The trailing net profit margin sits at 41.3%, up from 39.8% a year earlier, while quarterly revenue across FY 2025 moved in a relatively narrow band between US$74.6 million and US$81.8 million.
• What stands out for the more cautious, bearish view is the tension between strong margins today and softer growth expectations ahead:
  • Earnings are forecast to decline by about 0.7% per year over the next three years, even though recent profit growth of 12.5% and a 41.3% margin look healthy on past numbers.
  • Bears can point out that if revenue growth is expected at only 3.1% per year against a 10.5% US market benchmark, recent margin strength might be harder to rely on if growth conditions cool from here.

P/E Above Peers While Price Sits Below DCF Fair Value

• At a share price of US$124.26, City Holding trades on a 13.7x P/E versus peer and US banks industry averages of 12.6x and 11.8x, while the stock is also about 37.5% below the provided DCF fair value of US$198.83.
• Investors weighing the bearish narrative on valuation get a mixed picture from these figures:
  • Critics highlight that paying a 13.7x P/E multiple above peers might be hard to justify if earnings are expected to decline by around 0.7% per year and revenue growth is described as modest.
  • On the other hand, the gap between US$124.26 and the DCF fair value of US$198.83, together with a 2.8% dividend yield and long term earnings growth of 9.3% per year, means the market is pricing the stock below that DCF estimate despite the higher P/E relative to peers.

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 City Holding'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

City Holding pairs a high 41.3% net margin with modest 3.1% revenue growth expectations and an earnings outlook that is described as slightly declining.

If that mix of slower growth expectations and a richer 13.7x P/E multiple makes you cautious, shift your focus to stable growth stocks screener (2161 results) and zero in on companies built around steadier expansion.

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.