Financial Institutions (FISI) AI Stock Analysis

• Market Cap: $441.91M
• Dividend Yield: 5.5%
• Average Volume (3M): 230.09K
• Price to Earnings (P/E): 8.5
• Beta (1Y): 0.96
• Revenue Growth: -20.47%
• EPS Growth: -177.92%
• Country: US
• Employees: 598
• Sector: Financial
• Sector Strength: 86
• Industry: Banks - Regional
• EPS (TTM): -2.50
• Shares Outstanding: 20,077,892
• 10 Day Avg. Volume: 227,113
• 30 Day Avg. Volume: 230,086
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 4.60
• Price to Cash Flow (P/CF): 4.70
• P/FCF Ratio: 2.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $33.50
• Price Target Upside: 56.32% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

Financial Institutions Inc. is facing considerable challenges, particularly in its financial performance, with declining revenues and profitability impacting its overall stability. Although there are some positive signs in terms of cash flow improvements and dividend yield, these are overshadowed by broader financial difficulties and a bearish technical outlook. The mixed earnings call results add to the uncertainty, but the company's efforts to strengthen its capital position and improve profitability metrics offer some hope for recovery. Overall, the stock is rated cautiously due to the significant risks and volatility in the banking sector.

Financial Institutions Business Overview & Revenue Model

Company Description

Financial Institutions, Inc. operates as a holding company for the Five Star Bank, a chartered bank that provides banking and financial services to individuals, municipalities, and businesses in New York. The company offers checking and savings account programs, including money market accounts, certificates of deposit, sweep investments, and individual retirement and other qualified plan accounts. Its loan products include term loans and lines of credit; short and medium-term commercial loans for working capital, business expansion, and purchase of equipment; commercial business loans to the agricultural industry; commercial mortgage loans; one-to-four family residential mortgage loans, home improvement loans, closed-end home equity loans, and home equity lines of credit; and consumer loans, such as automobile, secured installment, and personal loans. The company also provides personal insurance products, including automobile, homeowners, boat, recreational vehicle, landlord, and umbrella coverage; commercial insurance comprising property, liability, automobile, inland marine, workers compensation, bonds, crop, and umbrella insurance products; and financial services comprising life and disability insurance, medicare supplements, long-term care, annuities, mutual funds, and retirement programs. In addition, it offers customized investment advisory, wealth management, investment consulting, and retirement plan services, as well as operates a real estate investment trust that holds residential mortgages and commercial real estate loans. The company operates a network of 48 banking offices in Allegany, Cattaraugus, Cayuga, Chautauqua, Chemung, Erie, Genesee, Livingston, Monroe, Ontario, Orleans, Seneca, Schuyler, Steuben, Wayne, Wyoming, and Yates counties, New York. Financial Institutions, Inc. was founded in 1817 and is headquartered in Warsaw, New York.

How the Company Makes Money

Financial Institutions, Inc. generates revenue primarily through the interest income derived from its lending activities, which include personal, commercial, and mortgage loans. The company also earns money from non-interest income sources such as fees for various banking services, including account maintenance, transaction processing, and investment advisory services. Additionally, FISI benefits from strategic partnerships and investments that enhance its service offerings and expand its market reach, contributing to its overall financial performance.

Financial Institutions Financial Statement Overview

Summary

Financial Institutions is facing challenges across its financial statements. Declining revenue and profitability, coupled with a weak balance sheet characterized by negative equity in some years, suggest financial instability. Improvements in cash flow efficiencies are noted, but these are overshadowed by broader financial difficulties. The company needs to address its revenue generation and manage its debt to improve its financial health and stability.

Income Statement

The company experienced a negative revenue growth rate of approximately -12.5% from 2022 to 2023 and further negative growth from 2023 to 2024. The gross profit margin remained consistent but the net profit margin turned negative in 2024 due to substantial net losses. These factors indicate significant challenges in revenue generation and profitability.

Balance Sheet

The debt-to-equity ratio is concerning due to negative equity in previous years, indicating financial instability. Although the equity ratio improved to a positive figure in 2024, previous years show negative equity, reflecting a fragile balance sheet. The return on equity is negative in 2024 due to net losses, which highlights profitability issues.

Cash Flow

Cash flow from operations improved in 2024 compared to 2023, but the free cash flow growth rate is negative over the period. The operating cash flow to net income ratio is positive, indicating decent cash generation relative to net income, despite the negative net income affecting financial health.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
313.23M	200.28M	212.35M	199.56M	182.06M
	Gross Profit
313.23M	200.28M	212.35M	199.56M	182.06M
	EBIT
311.66M	61.38M	106.83M	97.22M	45.72M
	EBITDA
0.00	0.00	79.08M	105.27M	53.62M
	Net Income Common Stockholders
-41.65M	50.26M	56.57M	77.70M	38.33M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
966.06M	124.44M	1.08B	1.26B	721.94M
	Total Assets
6.12B	6.16B	5.27B	5.00B	4.45B
	Total Debt
99.00M	343.32M	279.22M	538.00K	5.30M
	Net Debt
44.04M	218.88M	148.76M	-78.57M	-88.58M
	Total Liabilities
5.55B	5.71B	5.41B	5.02B	4.44B
	Stockholders Equity
17.29M	454.80M	-137.49M	-13.56M	2.13M
Cash Flow		Free Cash Flow
77.13M	7.90M	125.20M	63.56M	39.19M
	Operating Cash Flow
77.13M	10.89M	133.57M	72.96M	43.45M
	Investing Cash Flow
-8.23M	-310.09M	-325.16M	-633.42M	-531.07M
	Financing Cash Flow
-106.02M	293.17M	242.94M	545.69M	468.55M

Financial Institutions Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 21.43
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: 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 21.43 is below the 20-day moving average (MA) of 24.37, below the 50-day MA of 26.14, and below the 200-day MA of 24.97, indicating a bearish trend. The MACD of -0.51 indicates Positive momentum. The RSI at 34.77 is Neutral, neither overbought nor oversold. The STOCH value of 10.32 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FISI.

Financial Institutions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FMNB	71 Outperform	$450.62M	9.78	11.34%	5.68%	5.55%	-7.98%
CCNE	67 Neutral	$437.86M	8.74	9.17%	3.42%	11.48%	-6.49%
CBNK	66 Neutral	$439.90M	12.48	10.15%	1.44%	14.04%	-16.49%
PGC	64 Neutral	$433.57M	13.33	5.55%	0.81%	7.60%	-31.74%
Sector *	64 Neutral	$13.21B	9.26	9.39%	4.87%	16.14%	-8.87%
FISI	48 Neutral	$441.91M	8.52	-8.14%	5.50%	-20.47%	-177.92%

Financial Institutions Corporate Events

Financial Institutions Increases Quarterly Cash Dividend

On February 12, 2025, Financial Institutions, Inc. announced a 3.3% increase in its quarterly cash dividend to $0.31 per common share, reflecting the Board’s commitment to shareholder value and confidence in sustainable growth. Additionally, dividends of $0.75 per share on Series A 3% Preferred Stock and $2.12 per share on Series B-1 8.48% Preferred Stock were declared, all payable on April 2, 2025, to shareholders recorded by March 14, 2025.

Financial Institutions Reports 2024 Results Amid Restructuring

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.

Financial Institutions Expands Board with New Appointment

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.