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Community Bank System (CBU)
NYSE:CBU
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Community Bank System
(NYSE:CBU)
73Outperform
Positive Factors
Earnings
Analyst upgrades Community Financial System (CBU) to Strong Buy from Market Perform, reflecting an improved earnings outlook and continued strong growth from fee-based businesses.
Revenue Growth
Fee income growth continues to exceed expectations, with broad-based growth across all business lines, contributing significantly to total revenue.
Negative Factors
Financial Risks
Potential risks to CBU's target include rapid deterioration in credit quality, dilutive mergers and acquisitions, slower repricing, or general weakness in bank stocks.
Community Bank System (CBU) vs. S&P 500 (SPY)
Market Cap
$2.97B
Dividend Yield3.23%
Average Volume (3M)212.03K
Price to Earnings (P/E)16.5
Beta (1Y)1.19
Revenue Growth24.22%
EPS Growth35.49%
CountryUS
Employees2,687
SectorFinancial
Sector Strength77
IndustryBanking
Share Statistics
EPS (TTM)3.43
Shares Outstanding52,712,322
10 Day Avg. Volume266,610
30 Day Avg. Volume212,025
Financial Highlights & Ratios
PEG Ratio0.46
Price to Book (P/B)N/A
Price to Sales (P/S)4.10
Price to Cash Flow (P/CF)11.30
P/FCF Ratio8.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$76.00Price Target Upside33.15% Upside
Rating ConsensusHold
Number of Analyst Covering1
Community Bank System Business Overview & Revenue Model
Company DescriptionCommunity Bank System, Inc. (CBU) is a financial holding company headquartered in DeWitt, New York. It operates through its subsidiaries, providing a broad range of retail and business banking services. The bank primarily serves customers in the northeastern United States, focusing on community-oriented financial solutions. Its core services include personal and commercial banking, mortgage lending, insurance, and wealth management services.
How the Company Makes MoneyCommunity Bank System, Inc. generates revenue primarily through interest income from loans and leases, as well as interest and dividends from investment securities. The company also earns non-interest income from fees and service charges associated with deposit accounts, wealth management, insurance services, and card services. In addition, CBU benefits from strategic acquisitions and partnerships that expand its footprint and enhance its product offerings, further contributing to its revenue growth. By maintaining a diverse portfolio of financial products and services, Community Bank System is able to create multiple streams of income and sustain financial stability.
Community Bank System Financial Statement Overview
Summary
Community Bank System demonstrates a solid financial position with strong income, balance sheet, and cash flow scores. The company shows stable profitability with strong margins and zero debt, reflecting prudent financial management. Opportunities for growth in revenue and free cash flow stability could enhance future performance.Income Statement
Community Bank System shows a stable income statement with consistent revenue and net income growth over recent years. The gross profit margin and EBIT margins remain strong, indicating efficient cost management and operational efficiency. However, revenue growth has been relatively modest, and net profit margins could see further improvement.75
Positive
Balance Sheet
The balance sheet reflects a strong equity position with zero total debt as of the latest report, highlighting a conservative financial strategy. The equity ratio remains solid, indicating healthy financial leverage. Nevertheless, a decrease in stockholders' equity over time suggests attention may be needed in sustaining shareholder value.80
Positive
Cash Flow
Cash flow analysis indicates positive operating cash flow and free cash flow, which support business sustainability. However, fluctuations in investing and financing cash flows suggest variability in cash management strategies. The free cash flow growth rate is positive but not consistently high, leaving room for improvement in cash flow stability.70
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 643.53M | 640.67M | 679.36M | 620.65M | 596.40M | Gross Profit |
| 328.49M | 756.03M | 364.39M | 323.86M | 312.99M | EBIT |
| 297.11M | 227.08M | 278.63M | 241.35M | 206.08M | EBITDA |
| 297.11M | 195.73M | 272.34M | 271.51M | 242.02M | Net Income Common Stockholders |
| 182.48M | 131.92M | 188.08M | 189.69M | 164.68M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 2.98B | 190.96M | 4.36B | 6.81B | 5.19B | Total Assets |
| 16.39B | 15.56B | 15.84B | 15.55B | 13.93B | Total Debt |
| 737.31M | 460.60M | 1.91B | 329.88M | 371.29M | Net Debt |
| 545.42M | 269.64M | 1.70B | -1.55B | -1.27B | Total Liabilities |
| 14.62B | 13.86B | 14.28B | 13.45B | 11.83B | Stockholders Equity |
| 1.76B | 1.70B | 1.55B | 2.10B | 2.10B |
| Cash Flow | Free Cash Flow | |||
| 242.28M | 209.84M | 201.68M | 189.37M | 165.09M | Operating Cash Flow |
| 242.28M | 228.42M | 214.60M | 202.55M | 179.48M | Investing Cash Flow |
| -835.62M | 335.78M | -2.14B | -1.53B | -398.72M | Financing Cash Flow |
| 599.38M | -583.13M | 259.22M | 1.56B | 1.66B |
Community Bank System Technical Analysis
Negative
57.08
Price Trends
63.11
Negative
64.09
Negative
58.78
Negative
Market Momentum
-1.93
Positive
29.06
Positive
5.74
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CBU, the sentiment is Negative. The current price of 57.08 is below the 20-day moving average (MA) of 62.06, below the 50-day MA of 63.11, and below the 200-day MA of 58.78, indicating a bearish trend. The MACD of -1.93 indicates Positive momentum. The RSI at 29.06 is Positive, neither overbought nor oversold. The STOCH value of 5.74 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CBU.
Community Bank System Risk Analysis
Community Bank System disclosed 32 risk factors in its most recent earnings report. Community Bank System reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Community Bank System Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $5.50B | 13.77 | 10.38% | 2.76% | 8.83% | 3.77% | |
74 Outperform | $4.71B | 10.33 | 7.53% | 3.67% | 15.34% | -3.89% | |
73 Outperform | $2.97B | 16.48 | 10.51% | 3.23% | 24.22% | 35.49% | |
72 Outperform | $7.98B | 15.39 | 16.67% | 1.73% | -2.75% | 11.75% | |
69 Neutral | $2.00B | 10.05 | 2.68% | 2.83% | -11.99% | -103.10% | |
65 Neutral | $8.35B | 11.14 | 8.54% | 3.28% | 5.86% | -10.72% | |
64 Neutral | $13.79B | 10.52 | 9.20% | 4.24% | 17.25% | -7.60% |
* Financial Sector Average
Performance Comparison
CBU
Community Bank System
57.08
14.52
34.12%
CBSH
Commerce Bancshares
59.68
11.99
25.14%
FNB
F.N.B.
13.26
0.40
3.11%
HOMB
Home Bancshares
27.89
5.33
23.63%
TRMK
Trustmark
33.58
8.75
35.24%
WBS
Webster Financial
49.69
3.08
6.61%
Community Bank System Earnings Call Summary
Earnings Call Date: Jan 21, 2025 | % Change Since: -9.77% | Next Earnings Date: Apr 28, 2025
Earnings Call Sentiment Positive
The earnings call reflected a strong performance with record-breaking revenue growth, robust loan and deposit expansion, and successful segments like employee benefits and wealth management. However, challenges included increased nonperforming loans, higher expenses in the insurance services, and a rise in credit loss provisions. Despite these challenges, the company demonstrated strong liquidity and credit quality, contributing to an optimistic outlook for 2025.Highlights
Record-Breaking Revenue and Growth
Operating PPNR of $1.40 per share, which grew 8.5% compared to the prior quarter and 23.9% compared to last year's fourth quarter. Total operating revenues of $196 million, up 10.8% from a year prior.
Strong Loan and Deposit Growth
Loans grew by 7.5%, with overall lending growth of $728 million. Overall deposits grew by $514 million or 4%.
Employee Benefits Services Success
Revenues expanded by 11.8%, and operating income expanded by 11.9%.
Wealth Management Services Performance
Revenue growth of 14.9% and operating income growth of 22.9%.
Strong Liquidity and Credit Quality
Available liquidity of $5.8 billion or 246% of net uninsured deposits. Charge-offs of 10 basis points, half of the KRX Index average.
Lowlights
Increased Nonperforming Loans
Nonperforming loans totaled $73.4 million or 70 basis points of total loans, a $10.5 million increase from the linked third quarter.
Challenges in Insurance Services
Operating earnings were impacted by elevated expenses in the Insurance Services segment.
Higher Provision for Credit Losses
Provision for credit losses was $6.2 million during the fourth quarter, up from $4.1 million in the prior year's fourth quarter.
Expense Volatility
Expected increase in expenses due to expansion and new branches opening, particularly in the second and third quarters of 2025.
Company Guidance
In the fourth quarter of 2024 earnings call for Community Financial Systems, Inc. (CBU), the company reported strong financial performance and provided guidance for 2025. The operating pre-tax pre-provision net revenue (PPNR) per share grew by 8.5% from the previous quarter and 23.9% year-over-year, reaching $1.40. Operating earnings per share increased by 2.2% over the year. The company experienced robust growth in net interest income for the 18th consecutive year and saw a rise in fee income by 11.8%. Loan growth was notable at 7.5%, with commercial lending achieving double-digit growth. The company maintained a low cost of funds, with a deposit beta of 22%, and enhanced its liquidity position with $5.8 billion in available liquidity. For 2025, CBU anticipates mid-single-digit growth in its banking business, continued investment in employee benefit and insurance services, and expects credit costs to trend towards historical averages. Additionally, the company plans to open 16 new branches while consolidating others to optimize expenses. Overall, CBU aims to sustain its market share growth and manage a below-average risk profile in the upcoming year.Community Bank System Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Community Bank System Appoints New CFO Marya Wlos
Neutral
Mar 11, 2025
On March 11, 2025, Community Financial System, Inc. announced the appointment of Marya Burgio Wlos as Executive Vice President and Chief Financial Officer, effective March 31, 2025. She will succeed Joseph E. Sutaris, who will retire on July 1, 2025, after assisting with the transition. Ms. Wlos brings extensive financial experience from her previous roles at M&T Bank, UBS AG, Citadel LLC, and Bank of America. Her appointment is expected to play a critical role in executing the company’s strategic plan, with her compensation package including an annual base salary, incentive compensation, and equity awards. The transition marks a significant leadership change for the company, with implications for its strategic direction and operations.
Executive/Board ChangesShareholder Meetings
Community Bank System Announces Board Member’s Departure
Neutral
Feb 14, 2025
Susan E. Skerritt, a member of the Board of Directors at Community Financial System, Inc., has announced she will not seek re-election and will retire immediately following the 2025 Annual Meeting of Shareholders. Her decision to step down was not due to any disagreement with the company’s operations, policies, or practices.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.