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NASHVILLE, TN - Pinnacle Financial Partners Inc. (NASDAQ:PNFP), a $8.7 billion market cap financial institution that has delivered an impressive 40% return to shareholders over the past year, announced the approval of its 2025 Annual Cash Incentive Plan for employees, effective Monday. According to InvestingPro analysis, the company currently trades below its Fair Value, suggesting potential upside opportunity. The plan, sanctioned by the company’s Human Resources and Compensation Committee, aims to reward employees through cash incentives tied to the firm’s performance metrics.
Under the newly established plan, all employees on a predetermined salary or hourly wage are eligible for cash incentives. These incentives range from 10% to 125% of the employee’s base salary, contingent on achieving specific company and individual performance goals.
The incentives are primarily based on two performance metrics: a fully diluted earnings per share (EPS) goal and an annual total revenue target, both set for the fiscal year ending December 31, 2025. With analysts forecasting EPS of $7.88 for FY2025 and the company generating $1.62 billion in revenue over the last twelve months, these targets will be crucial benchmarks. The Classified Asset Ratio of Pinnacle Bank must also not exceed a predetermined ratio for the incentives to be paid. InvestingPro data reveals that 9 analysts have recently revised their earnings expectations upward for the upcoming period.
The cash incentives will be calculated with a 75% weight on the diluted EPS goal and a 25% weight on the revenue goal. Additionally, employees’ awards can be adjusted up or down by 10%, depending on their performance evaluation for the year.
Key executives’ potential cash incentives at target and maximum levels were disclosed, with M. Terry Turner, CEO, and Robert A. McCabe, Jr., Chairman, each standing to earn up to 125% and 156% of their base salaries, respectively, at maximum payout.
The incentive plan details, including the factors that could modify the incentives, such as the Committee’s discretion and individual performance evaluations, were outlined in the SEC filing. This disclosure aligns with Pinnacle Financial’s commitment to transparency and performance-based compensation.
Pinnacle Financial Partners, headquartered in Nashville, Tennessee, is a financial institution operating under the national commercial banks industry classification. Trading at a P/E ratio of 18.91, the company has maintained dividend payments for 13 consecutive years, demonstrating its commitment to shareholder returns. The company’s incentive plan is part of its broader strategy to align employee interests with company performance and shareholder value. For deeper insights into Pinnacle Financial’s performance metrics and growth potential, investors can access comprehensive analysis through InvestingPro’s detailed research reports, available for over 1,400 US stocks.
The information regarding Pinnacle Financial’s 2025 Annual Cash Incentive Plan is based on a press release statement filed with the SEC.
In other recent news, Pinnacle Financial Partners Inc. disclosed the issuance of equity awards to its top executives, including CEO M. Terry Turner. The awards consist of restricted share units and performance-based units that will vest over a three-year period, contingent on the company’s performance metrics. These metrics include return on average tangible common equity and tangible book value per share accretion. Additionally, Citi analyst Benjamin Gerlinger has raised the price target for Pinnacle Financial to $148, up from $132, maintaining a Buy rating. Gerlinger attributes this increase to Pinnacle’s notable loan growth and strategic hiring practices within the regional banking sector. The analyst anticipates that Pinnacle Financial will continue to outperform its peers, bolstered by a strong earnings per share outlook for 2026 and 2027. The firm’s confidence is further reflected in the potential for loan growth and net interest margin improvement, despite some projected expense increases. Overall, these developments highlight Pinnacle Financial’s strategic positioning and growth potential in the coming years.
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