Nasdaq:FMNB
FARMERS NATIONAL BANC CORP /OH/
A regional Ohio-based commercial bank offering diversified financial solutions with stable net income of $45.9M and total assets exceeding $5 billion.
Key Metrics
Investment Thesis
Bull Case
Farmers National Banc Corp offers stability for value investors with a healthy shareholders equity of $406.0M and consistent profitability in a recovering regional economy. The bank's active acquisition of marketable securities suggests strategic growth initiatives aimed at enhancing long-term return on assets without compromising current cash flow generation.
Bear Case
The substantial net change in cash of -$17.9M driven by heavy investing outflows could signal liquidity strain or aggressive balance sheet restructuring that may not immediately translate to earnings growth. Additionally, the retained earnings deficit of $257.2M indicates historical capital challenges that warrant close monitoring before committing significant new capital.
About FARMERS NATIONAL BANC CORP /OH/
Farmers National Banc Corp operates as a commercial bank providing comprehensive financial services including consumer lending, commercial banking, and trust services to communities across Ohio. The company generates revenue primarily through interest income on loans and securities, while managing significant liabilities in the form of customer deposits. Its operations focus on maintaining liquidity and profitability within a highly regulated regional banking environment.
Analysis
Management Discussion
The company reported a net profit of $45.9M against total revenue of $269.4M, reflecting solid operational efficiency with operating expenses at $214.0M. However, cash flow from investing was significantly negative at -$95.1M due to substantial marketable security purchases of $105.8M, indicating an active portfolio management strategy to balance yield and risk.
Industry Overview
The regional banking sector in Ohio is characterized by competition from larger national banks and fintech disruptors while benefiting from localized customer relationships and regulatory tailwinds supporting community development. Profitability remains sensitive to Federal Reserve policy decisions regarding interest rates and reserve requirements.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2024 |
|---|---|
| Revenue | $269.4M |
| Cost of Revenue | $0 |
| Gross Profit | $269.4M |
| Operating Expenses | $214.0M |
| Operating Income | $55.4M |
| Stock-Based Comp | $2.6M |
| Amortization | $2.9M |
| Non-Operating Income | $0 |
| Pre-Tax Income | $55.4M |
| Income Tax | $9.5M |
| Continuing Ops | $45.9M |
| Discontinued Ops | $0 |
| Net Income | $45.9M |
| Minority Interest | $0 |
| Net to Common | $45.9M |
| Metric | 2024 |
|---|---|
| PP&E (Net) | $52.3M |
| Goodwill | $167.4M |
| Operating Leases | $9.7M |
| Total Assets | $5.12B |
| Total Liabilities | $4.71B |
| Shareholders' Equity | $406.0M |
| Retained Earnings | $257.2M |
| AOCI | $-193.3M |
| Treasury Stock | $23.9M |
| Total L&E | $5.12B |
| Metric | 2024 |
|---|---|
| Net Income (CFO) | $45.9M |
| Non-Cash Adjustments | $-64.4M |
| Working Capital Changes | $85.0M |
| Cash from Operations | $66.6M |
| Capital Expenditures | $11.7M |
| Cash from Investing | $-95.1M |
| Share Buybacks | $0 |
| Dividends Paid | $25.4M |
| Cash from Financing | $10.6M |
| FX Effect | $0 |
| Net Change in Cash | $-17.9M |
| Beginning Cash | $103.7M |
| Ending Cash | $85.7M |
Frequently Asked Questions
How does FARMERS NATIONAL BANC CORP /OH/ make money?
Core commercial and consumer lending, deposit gathering activities, trust and wealth management services, and investment securities holdings.
What are the main risks for FMNB?
Elevated interest rate volatility impacting net interest margins, potential credit losses from economic downturns affecting the loan portfolio, regulatory compliance costs specific to banking institutions, and liquidity pressures from large investment outflows.
What is FMNB's competitive advantage?
Deep roots in local Ohio communities fostering strong customer loyalty, diversified revenue streams reducing reliance on a single sector, and efficient cost management relative to regional peers.
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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.