Essa Bancorp (ESSA) AI Stock Analysis

• Market Cap: $206.34M
• Dividend Yield: 2.95%
• Average Volume (3M): 46.97K
• Price to Earnings (P/E): 13.1
• Beta (1Y): 0.72
• Revenue Growth: 5.57%
• EPS Growth: -16.40%
• Country: US
• Employees: 236
• Sector: Financial
• Sector Strength: 75
• Industry: Banks - Regional
• EPS (TTM): 0.29
• Shares Outstanding: 10,154,664
• 10 Day Avg. Volume: 79,781
• 30 Day Avg. Volume: 46,966
• PEG Ratio: 0.38
• Price to Book (P/B): 0.89
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 8.55
• Enterprise Value/Market Cap: 1.90
• Enterprise Value/Revenue: 1.01
• Enterprise Value/Gross Profit: 3.97
• Enterprise Value/Ebitda: 4.60
• 1Y Price Target: $20.50
• Price Target Upside: 0.89% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 70 Outperform
• Price Target: $22.50 ▲(10.73%Upside)

Essa Bancorp's strong financial performance, characterized by consistent revenue growth and robust cash flow management, is a key strength. The technical indicators suggest a positive trend, though caution is warranted due to overbought signals. The valuation is reasonable, offering a balance of growth and income potential. The absence of earnings call data and corporate events did not impact the score.

Essa Bancorp Business Overview & Revenue Model

Company Description

ESSA Bancorp, Inc. operates as the holding company for ESSA Bank & Trust, offering a wide range of financial services primarily in Pennsylvania. The company provides retail and commercial banking services, including checking and savings accounts, loans, mortgages, and investment services, catering to both individual and business clients. Additionally, ESSA offers wealth management and insurance solutions, positioning itself as a comprehensive financial services provider.

How the Company Makes Money

ESSA Bancorp generates revenue primarily through interest income from its lending activities, including residential and commercial mortgages, consumer loans, and lines of credit. The company also earns non-interest income from fees related to account services, loan origination, and wealth management services. Another significant revenue stream comes from investment management and insurance services, which offer diversified financial solutions to clients. Strategic partnerships with other financial institutions and service providers further enhance its product offerings and contribute to its revenue growth.

Essa Bancorp Financial Statement Overview

Summary

Essa Bancorp presents a robust financial profile with strong profitability and a stable balance sheet. However, challenges remain in accelerating growth and enhancing cash flow stability.

Income Statement

Essa Bancorp exhibits solid profitability with a consistent gross profit margin and a net profit margin reflecting efficient revenue conversion. Revenue growth is modest year-over-year, indicating steady but not aggressive expansion. EBIT and EBITDA margins are healthy, supporting strong operational performance. However, the growth rate of revenue has slowed compared to previous years.

Balance Sheet

The company's balance sheet is stable with a manageable debt-to-equity ratio, indicating prudent leverage. The return on equity is satisfactory, showing effective use of equity capital. The equity ratio suggests a sound capital base, but there is room for improvement in reducing liabilities to enhance financial resilience.

Cash Flow

Operating cash flow coverage of net income is adequate, demonstrating operational efficiency. The free cash flow growth rate has been inconsistent, with fluctuations in capital expenditures and financing activities. The free cash flow to net income ratio is slightly below optimal, suggesting potential volatility in cash generation.

Breakdown	TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	98.67M	66.48M	69.30M	68.22M	64.39M	61.46M
Gross Profit	98.67M	66.48M	69.30M	68.22M	64.39M	61.46M
EBITDA	15.55M	0.00	25.18M	27.18M	22.08M	19.81M
Net Income	16.61M	16.99M	18.58M	20.07M	16.42M	14.42M
Balance Sheet
Total Assets	2.20B	2.19B	2.29B	1.86B	1.86B	1.89B
Cash, Cash Equivalents and Short-Term Investments	254.59M	254.55M	419.46M	236.58M	399.53M	368.40M
Total Debt	225.00M	290.00M	374.65M	230.81M	6.37M	125.88M
Total Liabilities	1.96B	1.96B	374.65M	1.65B	1.66B	1.70B
Stockholders Equity	234.18M	230.42M	219.71M	212.34M	201.82M	191.40M
Cash Flow
Free Cash Flow	9.43M	13.21M	19.91M	22.14M	18.97M	18.69M
Operating Cash Flow	9.82M	13.43M	20.86M	22.71M	19.38M	19.75M
Investing Cash Flow	38.33M	77.02M	-377.12M	-128.13M	31.79M	15.43M
Financing Cash Flow	-42.40M	-127.27M	413.73M	-25.59M	-48.14M	68.49M

Essa Bancorp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 20.32
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESSA, the sentiment is Positive. The current price of 20.32 is above the 20-day moving average (MA) of 19.86, above the 50-day MA of 19.09, and above the 200-day MA of 19.23, indicating a bullish trend. The MACD of 0.48 indicates Negative momentum. The RSI at 62.34 is Neutral, neither overbought nor oversold. The STOCH value of 39.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ESSA.

Essa Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HWBK	79 Outperform	$199.34M	10.64	6.62%	2.78%	4.86%	800.59%
FUNC	78 Outperform	$219.11M	9.83	12.99%	2.60%	13.41%	62.54%
FVCB	76 Outperform	$235.87M	13.03	8.16%	―	17.18%	305.35%
VABK	75 Outperform	$201.17M	11.31	11.15%	3.86%	2.26%	3.83%
WNEB	73 Outperform	$201.52M	19.09	4.65%	2.88%	8.70%	-10.56%
ESSA	70 Outperform	$206.34M	13.11	6.43%	2.95%	5.57%	-16.40%
Sector *	68 Neutral	$16.73B	11.75	9.79%	3.76%	11.87%	-7.97%

Essa Bancorp Corporate Events

Essa Bancorp Announces Strategic Merger with CNB Financial

ESSA Bancorp, Inc. has entered into a merger agreement with CNB Financial Corporation, where ESSA will merge into CNB and ESSA Bank & Trust will merge into CNB Bank. This strategic merger, valued at approximately $214 million, will result in the combined company having $8 billion in assets and expanding CNB’s presence in eastern Pennsylvania. The merger is expected to be financially beneficial with CNB projecting significant accretion to earnings per share by 2026 and a strong pro forma balance sheet, enhancing its market position in Pennsylvania.