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Financial Institutions Inc (FISI)
:FISI
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Financial Institutions
(NASDAQ:FISI)
55Neutral
Financial Institutions (FISI) vs. S&P 500 (SPY)
Market Cap
$505.17M
Dividend Yield4.63%
Average Volume (3M)163.65K
Price to Earnings (P/E)8.5
Beta (1Y)1.00
Revenue Growth-20.47%
EPS Growth-144.93%
CountryUS
Employees624
SectorFinancial
Sector Strength77
IndustryBanking
Share Statistics
EPS (TTM)-1.45
Shares Outstanding19,474,634
10 Day Avg. Volume164,998
30 Day Avg. Volume163,649
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.91
Price to Cash Flow (P/CF)48.50
P/FCF Ratio2.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$33.50Price Target Upside29.14% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Financial Institutions Business Overview & Revenue Model
Company DescriptionFinancial Institutions, Inc. (FISI) is a financial holding company based in the United States. It operates primarily through its bank subsidiary, Five Star Bank, which offers a wide range of banking and financial services. These services include personal and commercial banking, mortgage lending, wealth management, and insurance services. The company focuses on serving the needs of individuals, municipalities, and businesses across its market areas, providing a strong emphasis on customer service and community involvement.
How the Company Makes MoneyFinancial Institutions, Inc. generates revenue primarily through its banking operations. The company earns money from interest income on loans and investments, which is a significant portion of its revenue. It also generates income from non-interest sources such as fees for banking services, wealth management, and insurance products. Additionally, the company benefits from strategic partnerships and collaborations that enhance its service offerings and expand its market reach. The company's earnings are influenced by factors such as interest rates, loan demand, and economic conditions in the regions it serves.
Financial Institutions Financial Statement Overview
Summary
Financial Institutions shows strong revenue growth and a solid gross profit margin, indicating positive top-line performance. However, there are challenges with net profit margins, cash flow management, and volatility in stockholders' equity, which affect financial stability.Income Statement
The company shows a healthy gross profit margin with consistent growth in total revenue over the years. The TTM revenue growth rate is significant compared to the previous annual report, indicating strong market performance. However, the net profit margin and EBIT margin reveal slight declines, highlighting potential cost management challenges.70
Positive
Balance Sheet
The company maintains a low debt-to-equity ratio, indicative of a conservative leverage strategy. However, fluctuations in stockholders' equity, including negative values in past years, raise concerns about financial stability. The equity ratio has improved, but consistent positive equity is needed for long-term sustainability.60
Neutral
Cash Flow
The company experienced volatility in free cash flow and operating cash flow, with recent periods showing negative free cash flow. The operating cash flow to net income ratio is low, suggesting potential cash generation issues relative to earnings.55
Neutral
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 331.45M | 200.28M | 212.35M | 199.56M | 182.06M | 169.94M | Gross Profit |
| 331.45M | 200.28M | 212.35M | 199.56M | 182.06M | 169.94M | EBIT |
| 52.20M | 61.38M | 106.83M | 97.22M | 45.72M | 59.42M | EBITDA |
| 48.96M | 0.00 | 79.08M | 105.27M | 53.62M | 67.63M | Net Income Common Stockholders |
| 50.95M | 50.26M | 56.57M | 77.70M | 38.33M | 48.86M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 548.43M | 124.44M | 1.08B | 1.26B | 721.94M | 530.86M | Total Assets |
| 4.31B | 6.16B | 5.27B | 5.00B | 4.45B | 3.93B | Total Debt |
| 469.50M | 343.32M | 279.22M | 538.00K | 5.30M | 275.50M | Net Debt |
| 366.75M | 218.88M | 148.76M | -78.57M | -88.58M | 162.55M | Total Liabilities |
| 3.92B | 5.71B | 5.41B | 5.02B | 4.44B | 3.95B | Stockholders Equity |
| 396.29M | 454.80M | -137.49M | -13.56M | 2.13M | -14.51M |
| Cash Flow | Free Cash Flow | ||||
| -57.25M | 7.90M | 125.20M | 63.56M | 39.19M | 54.07M | Operating Cash Flow |
| 2.24M | 10.89M | 133.57M | 72.96M | 43.45M | 57.71M | Investing Cash Flow |
| 99.97M | -310.09M | -325.16M | -633.42M | -531.07M | -24.73M | Financing Cash Flow |
| -44.76M | 293.17M | 242.94M | 545.69M | 468.55M | -22.79M |
Financial Institutions Technical Analysis
Negative
25.94
Price Trends
27.37
Negative
26.85
Negative
24.36
Positive
Market Momentum
-0.35
Positive
31.99
Neutral
16.35
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FISI, the sentiment is Negative. The current price of 25.94 is below the 20-day moving average (MA) of 27.91, below the 50-day MA of 27.37, and above the 200-day MA of 24.36, indicating a neutral trend. The MACD of -0.35 indicates Positive momentum. The RSI at 31.99 is Neutral, neither overbought nor oversold. The STOCH value of 16.35 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FISI.
Financial Institutions Risk Analysis
Financial Institutions disclosed 45 risk factors in its most recent earnings report. Financial Institutions 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
Financial Institutions 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 | 14.04 | 10.38% | 2.71% | 8.83% | 3.77% | |
74 Outperform | $4.71B | 10.38 | 7.53% | 3.65% | 15.34% | -3.89% | |
65 Neutral | $2.51B | 16.98 | 4.39% | 4.21% | 6.86% | -12.06% | |
64 Neutral | $1.68B | 14.79 | 16.49% | 2.63% | 11.10% | 3.74% | |
64 Neutral | $13.80B | 10.64 | 9.23% | 4.22% | 17.66% | -7.66% | |
61 Neutral | $102.24M | 27.47 | 5.14% | 2.36% | 16.38% | ― | |
55 Neutral | $505.17M | 8.52 | -5.09% | 4.63% | -20.47% | -144.93% |
* Financial Sector Average
Performance Comparison
FISI
Financial Institutions
25.87
8.39
48.00%
CHCO
City Holding Company
114.54
15.23
15.34%
FNB
F.N.B.
13.08
0.02
0.15%
HOMB
Home Bancshares
27.68
4.54
19.62%
PBHC
Pathfinder Bancorp
16.58
4.85
41.35%
SFNC
Simmons 1st Nat'l
19.68
1.33
7.25%
Financial Institutions Earnings Call Summary
Earnings Call Date: Jan 30, 2025 | % Change Since: -4.49% | Next Earnings Date: Apr 23, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a mixed picture. While there were significant positive developments such as successful equity offering, improved capital ratios, and strong commercial loan growth, the call also reported substantial losses due to securities repositioning and a decline in deposits. The guidance for 2025 appears conservative but optimistic, with a focus on profitability and efficiency.Highlights
Successful Equity Offering and Restructuring
The company successfully executed an equity offering that was more than 4x oversubscribed, issuing $115 million of new capital with net proceeds of $108.5 million. This, along with restructuring of the available-for-sale investment securities portfolio, is expected to contribute to a stronger earnings profile.
Regulatory Capital Ratios Improvement
The common equity Tier 1 ratio increased by 60 basis points from September 30 and 145 basis points from year-end 2023. The TCE ratio also improved by 147 and 240 basis points, respectively.
Commercial Loan Growth
Commercial loan growth was strong, up 3.8% during the quarter and 4.5% during the full year 2024.
Positive Market Reception
Market reception to the common equity offering was very positive, leading to a quick execution of the overallotment.
Margin Expansion
Margin expansion continued, with a 2 basis point increase from the third quarter to 2.91% in the fourth quarter.
Lowlights
Pretax Loss from Securities Repositioning
A $100.2 million pretax loss was recorded due to the securities repositioning, resulting in net losses available to common shareholders for the fourth quarter of $66.1 million.
Deposit Decline
Total deposits declined by $202 million from September 30, primarily due to seasonal reductions in public deposit accounts.
Increase in Provision for Credit Losses
The provision for credit losses increased to $6.5 million in the fourth quarter of 2024 compared to $3.1 million in the third quarter, attributed to higher loan growth, net charge-offs, and qualitative factors.
Increase in FDIC Assessment Expense
FDIC assessment expense was about $0.5 million higher than in the third quarter due to an increase in the assessment rate.
Company Guidance
During the Financial Institutions, Inc. Fourth Quarter and Year-end 2024 Earnings Call, several key financial metrics and strategic initiatives were highlighted. The company reported a $100.2 million pretax loss due to restructuring its investment securities portfolio, which led to net losses available to common shareholders of $66.1 million for the fourth quarter. Despite this, the firm's capital position strengthened, with a common equity Tier 1 ratio increase of 60 basis points from September 30, 2024, and 145 basis points from year-end 2023. The net interest margin expanded to 2.91% in the fourth quarter, a 2 basis point increase from the third quarter. Commercial loan growth was robust, rising by 3.8% during the quarter and 4.5% throughout the year. Additionally, the company issued $115 million in new capital from an equity offering, with net proceeds amounting to $108.5 million. For 2025, the company targets a return on average assets of at least 110 basis points, a return on average equity of at least 11.25%, and an efficiency ratio below 60%, with expectations of net interest margin between 345 and 355 basis points.Financial Institutions Corporate Events
Private Placements and FinancingBusiness Operations and StrategyFinancial Disclosures
Financial Institutions Reports 2024 Results Amid Restructuring
Negative
Jan 30, 2025
Financial Institutions, Inc. announced its financial results for the fourth quarter and full year of 2024, reflecting a balance sheet restructuring plan executed in December. The company reported a net loss of $65.7 million for the fourth quarter, primarily due to a $100.2 million pre-tax loss from the sale of $653.5 million in investment securities. The funds raised from a successful equity offering were used to offset these losses and reinvested into higher-yielding securities, improving the company’s capital position. Despite a challenging year, the company remains optimistic about future growth opportunities, citing strategic initiatives and improved metrics, such as a 10.88% common equity tier 1 ratio and a 2.91% net interest margin by year-end 2024.
Executive/Board ChangesBusiness Operations and Strategy
Financial Institutions Expands Board with New Appointment
Positive
Jan 27, 2025
On January 22, 2025, Financial Institutions, Inc. expanded its Board of Directors from eleven to twelve members by appointing Angela J. Panzarella. She will serve on the Audit and Management Development & Compensation Committees, bringing significant business and nonprofit leadership experience, including past roles at the YWCA of Rochester and Monroe County, Bausch + Lomb, and ACM Medical Laboratory, Inc. Her appointment is expected to enhance the company’s strategic execution and community engagement, particularly in the Greater Rochester area, a key market for the company.
Dividends
Financial Institutions Announces Quarterly Dividend Payments
Positive
Nov 20, 2024
Financial Institutions, Inc. has announced a quarterly cash dividend of $0.30 per common share, along with dividends of $0.75 and $2.12 per share on its Series A and Series B-1 preferred stocks, respectively. These dividends are set to be paid on January 2, 2025, to shareholders recorded by December 13, 2024. With $6.2 billion in assets, the company offers diverse banking and wealth management services through its subsidiaries, Five Star Bank and Courier Capital, LLC.
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.