NYSE:FHN
FIRST HORIZON CORP
A regional bank serving small businesses and individuals with a strong focus on the Southeastern US market.
Key Metrics
Investment Thesis
Bull Case
The company demonstrated strong earnings growth with net profit rising from $794M to $998M, suggesting effective cost management or favorable interest rate environments. Significant capital return via nearly $1B in share repurchases indicates confidence in the stock's undervaluation and commitment to shareholder value. Robust operating cash flow of $628M supports dividend sustainability and future organic growth initiatives.
Bear Case
The balance sheet shows a substantial retained earnings deficit of $5.03B, which may raise concerns about long-term capital adequacy or historical loss absorption needs. Heavy reliance on regional markets creates vulnerability to local economic shocks, while accumulated other comprehensive income losses of $810M could signal unrealized losses in the investment portfolio. High total liabilities relative to equity ($74.73B vs $9.14B) highlights significant leverage that must be monitored closely.
About FIRST HORIZON CORP
First Horizon Corporation provides commercial banking services primarily to small businesses and individuals across the Southeastern United States. The bank offers a full suite of retail and commercial banking products, including consumer loans, mortgages, and deposit accounts. Its operations are concentrated in states such as Alabama, Florida, Georgia, Illinois, Kentucky, Mississippi, Tennessee, Texas, and Virginia.
Analysis
Management Discussion
In 2025, First Horizon reported revenue of $3.42B and net profit of $998M, representing an increase from the prior year figures of $3.19B and $794M respectively. Cash flow from operations remained robust at $628M while capital expenditures were contained at $33M, indicating a focus on organic growth rather than heavy infrastructure expansion. The company returned substantial value to shareholders through $918M in common share repurchases and $314M in dividends.
Industry Overview
The regional banking sector is characterized by intense competition for deposits and loans, with profitability heavily dependent on net interest margins and credit loss provisions. Smaller regional banks often compete on community ties and specialized lending products rather than scale, making them sensitive to local economic conditions. Regulatory scrutiny remains high for institutions holding large loan portfolios to ensure capital buffers are sufficient against potential defaults.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2024 | 2025 |
|---|---|---|
| Revenue | $3.19B | $3.42B |
| Cost of Revenue | $0 | $0 |
| Gross Profit | $3.19B | $3.42B |
| Operating Expenses | $2.19B | $2.14B |
| Operating Income | $1.00B | $1.28B |
| Stock-Based Comp | $59.0M | $61.0M |
| D&A | $101.0M | $64.0M |
| Amortization | $44.0M | $38.0M |
| Non-Operating Income | $0 | $0 |
| Pre-Tax Income | $1.00B | $1.28B |
| Income Tax | $211.0M | $282.0M |
| Continuing Ops | $794.0M | $998.0M |
| Discontinued Ops | $0 | $0 |
| Net Income | $794.0M | $998.0M |
| Minority Interest | $19.0M | $16.0M |
| Net to Common | $775.0M | $982.0M |
| Metric | 2024 | 2025 |
|---|---|---|
| PP&E (Net) | $574.0M | $544.0M |
| Intangibles | $143.0M | $105.0M |
| Goodwill | $1.51B | $1.51B |
| Operating Leases | $296.0M | $321.0M |
| Total Assets | $82.15B | $83.88B |
| Total Liabilities | $73.04B | $74.73B |
| Shareholders' Equity | $9.11B | $9.14B |
| Retained Earnings | $4.38B | $5.03B |
| AOCI | $-1.13B | $-810.0M |
| Total L&E | $82.15B | $83.88B |
| Metric | 2024 | 2025 |
|---|---|---|
| Net Income (CFO) | $794.0M | $998.0M |
| Non-Cash Adjustments | $1.69B | $-1.73B |
| Working Capital Changes | $-1.21B | $1.36B |
| Cash from Operations | $1.27B | $628.0M |
| Capital Expenditures | $44.0M | $33.0M |
| Cash from Investing | $-1.06B | $-1.09B |
| Debt Issuances | — | $513.0M |
| Debt Repayments | — | $366.0M |
| Share Buybacks | $626.0M | $918.0M |
| Dividends Paid | $332.0M | $314.0M |
| Cash from Financing | $-404.0M | $524.0M |
| FX Effect | $0 | $0 |
| Net Change in Cash | $-194.0M | $58.0M |
| Beginning Cash | $1.73B | $1.54B |
| Ending Cash | $1.54B | $1.59B |
Frequently Asked Questions
How does FIRST HORIZON CORP make money?
The company generates revenue through its commercial banking segment serving small and mid-sized enterprises, its retail banking segment targeting individual consumers for deposits and loans, and its consumer lending activities including auto and mortgage financing. Financial data indicates significant gross profit derived from these core lending and deposit-taking activities alongside investment securities portfolios.
What are the main risks for FHN?
Regional concentration in the Southeast exposes the company to specific economic cycles and natural disaster risks prevalent in those states. Fluctuations in net interest margins due to Federal Reserve policy changes and credit quality deterioration in the commercial loan portfolio could impact profitability. High levels of accumulated other comprehensive income losses and a significant retained earnings deficit suggest potential regulatory or historical capital management challenges.
What is FHN's competitive advantage?
First Horizon benefits from deep roots in the Southeastern US providing localized community expertise and relationship-based banking services that large national competitors often lack. The bank maintains a diversified loan portfolio across multiple states which helps mitigate regional economic downturns, while its focus on small business lending creates high switching costs for corporate clients.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.