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First Business Financial Services (FBIZ)
NASDAQ:FBIZ
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First Business Financial (FBIZ) AI Stock Analysis

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FBIZ

First Business Financial

(NASDAQ:FBIZ)

Rating:74Outperform
Price Target:
$55.00
▲(12.70%Upside)
FBIZ's overall score is bolstered by a strong earnings call and solid valuation metrics. Financial performance remains robust, but technical indicators suggest caution due to bearish trends. The company's sound fundamentals and strategic growth initiatives provide a strong foundation, but market sentiment and technical outlook require careful monitoring.

First Business Financial (FBIZ) vs. SPDR S&P 500 ETF (SPY)

First Business Financial Business Overview & Revenue Model

Company DescriptionFirst Business Financial Services, Inc. operates as the bank holding company for First Business Bank that provides commercial banking products and services for small and medium-sized businesses, business owners, executives, professionals, and high net worth individuals. The company offers deposit products, such as non-interest-bearing transaction accounts, interest-bearing transaction accounts, money market accounts, time deposits, and certificates of deposit, as well as credit cards. It also provides loan products, including commercial real estate loans, commercial and industrial loans, small business administration loans, and direct financing leases, as well as consumer and other loans comprising home equity, first and second mortgage, and other personal loans for professional and executive clients. The company offers commercial lending, asset-based lending, equipment financing, accounts receivable financing, vendor financing, floorplan financing, treasury management services, and company retirement plans; trust and estate administration, financial planning, investment management, and private banking services; and investment portfolio administrative, asset-liability management, and asset-liability management process validation services for other financial institutions. First Business Financial Services, Inc. was founded in 1909 and is headquartered in Madison, Wisconsin.
How the Company Makes MoneyFirst Business Financial (FBIZ) generates revenue through a diverse range of financial services tailored to meet the needs of small and medium-sized enterprises. The company's primary revenue streams include interest income from loans and leases, fee income from treasury management and asset-based lending services, and gains from the sale of financial products. Additionally, FBIZ benefits from strategic partnerships with other financial institutions, enhancing its product offerings and market reach. The company focuses on building strong client relationships to ensure a stable and recurring revenue base.

First Business Financial Earnings Call Summary

Earnings Call Date:Jul 24, 2025
(Q2-2025)
|
% Change Since: -5.26%|
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook with significant growth in core deposits, Private Wealth assets, and tangible book value. Despite challenges such as an increase in NPAs and a decrease in certain fee incomes, the company's strong loan growth, consistent revenue, and low net charge-offs indicate a healthy financial position.
Q2-2025 Updates
Positive Updates
Strong Core Deposit Growth
Core deposits increased by $70 million or 11% annualized from the first quarter and up 10% from last year's second quarter. Service charges on deposits also grew 16% from last year's second quarter.
Impressive Private Wealth Growth
Private Wealth assets under management grew an incredible 36% annualized during the quarter and were up 15% from a year ago.
Tangible Book Value Increase
Tangible book value per share grew an impressive 14% from a year ago.
Consistent Revenue Growth
Operating revenue increased with pretax pre-provision adjusted earnings up 13% over last year's second quarter and EPS up 10%.
Loan Growth
Loan balances grew about $267 million over the same period last year, up about 9%. Total C&I balances expanded $30 million or 10% annualized.
Low Net Charge-offs
There was a decline in net charge-offs, particularly in the transportation and logistics segment of the small ticket equipment finance portfolio.
Negative Updates
Increase in Non-Performing Assets
The $4.6 million increase in NPAs was due to a single credit in the transportation and logistics sector of the conventional C&I portfolio.
Decrease in SBA Loan Sale Premiums and Fee Income
There was a decrease in SBA loan sale premiums and fee income due to the timing of closings and loans fully funding.
Decline in Fees in Lieu of Interest
Fees in lieu of interest, which includes prepayment fees and asset-based loan fees, declined by $379,000 from Q1.
Decrease in SBIC Fee Income
A decrease of $369,000 in SBIC fee income was observed in Q2.
Company Guidance
During the Second Quarter 2025 earnings call, First Business Bank reported impressive financial performance metrics aligned with their strategic plan for double-digit annual growth. Core deposits grew by $70 million or 11% annualized from the first quarter, while loans increased by $267 million or 9% year-over-year. The net interest margin remained strong at 3.67%, and net charge-offs declined. The bank achieved a 13% increase in pretax pre-provision adjusted earnings and a 10% rise in EPS over the previous year's second quarter. Notably, tangible book value per share surged 14% from a year ago. Despite a competitive market, the bank maintained robust asset quality with minimal net charge-offs and a well-collateralized loan portfolio. Private Wealth assets under management also saw significant growth, expanding 36% annualized during the quarter. The bank's revenue diversification strategy contributed to stable operating revenue, even amidst variability in fee income sources.

First Business Financial Financial Statement Overview

Summary
First Business Financial displays strong financial health across income, balance sheet, and cash flow metrics. The company has demonstrated consistent revenue and profit growth, effective equity utilization, and solid cash flow management. However, attention should be given to maintaining operational efficiency and managing investing activities to sustain long-term growth and stability.
Income Statement
82
Very Positive
The income statement shows a positive trajectory with steady revenue growth over recent years. The latest TTM data indicates a gross profit margin of 113.07% and a net profit margin of 29.79%, both reflecting strong profitability. Additionally, there is a notable revenue growth rate of 8.57% from 2023 to 2024. However, the EBIT margin stands at 25.83%, showing a slight decline from previous periods, requiring attention to operational efficiency.
Balance Sheet
75
Positive
The balance sheet reveals a stable financial position, indicated by a decreasing debt-to-equity ratio from 1.64 in 2020 to 0.52 in the latest TTM, emphasizing improved financial leverage. The equity ratio remains healthy at 8.52%, showcasing solid equity backing. Return on Equity (ROE) is also robust at 13.86%, demonstrating effective equity utilization. However, caution is advised due to the overall low equity ratio, which could pose risks during economic downturns.
Cash Flow
78
Positive
Cash flow analysis shows consistent operating cash flows, with a recent increase in free cash flow growth to 5.11% year-over-year. The operating cash flow to net income ratio of 1.29 indicates strong cash generation relative to earnings. Additionally, the free cash flow to net income ratio is 1.29, reflecting efficient cash management. However, significant negative investing cash flows may warrant further analysis.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue262.38M226.24M150.80M124.09M118.72M
Gross Profit144.63M135.71M131.72M118.56M84.81M
EBITDA54.89M50.77M56.31M50.58M21.77M
Net Income44.24M37.03M40.86M35.76M16.98M
Balance Sheet
Total Assets3.85B3.51B2.98B2.65B2.57B
Cash, Cash Equivalents and Short-Term Investments499.09M436.52M314.71M262.81M240.83M
Total Debt327.98M339.87M466.98M418.93M435.62M
Total Liabilities3.52B3.22B2.72B2.42B2.36B
Stockholders Equity328.59M289.59M260.64M232.42M206.16M
Cash Flow
Free Cash Flow57.27M49.41M35.42M35.60M26.37M
Operating Cash Flow57.49M52.29M38.65M35.99M26.64M
Investing Cash Flow-328.47M-506.85M-245.27M-111.01M-454.51M
Financing Cash Flow289.17M491.38M252.19M75.22M417.68M

First Business Financial Technical Analysis

Technical Analysis Sentiment
Negative
Last Price48.80
Price Trends
50DMA
50.22
Negative
100DMA
48.78
Positive
200DMA
48.27
Positive
Market Momentum
MACD
0.17
Positive
RSI
36.93
Neutral
STOCH
6.92
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FBIZ, the sentiment is Negative. The current price of 48.8 is below the 20-day moving average (MA) of 52.83, below the 50-day MA of 50.22, and above the 200-day MA of 48.27, indicating a neutral trend. The MACD of 0.17 indicates Positive momentum. The RSI at 36.93 is Neutral, neither overbought nor oversold. The STOCH value of 6.92 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FBIZ.

First Business Financial Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
$421.41M13.5314.00%1.45%13.07%25.72%
77
Outperform
$506.30M11.9412.21%10.44%62.82%
74
Outperform
$406.19M8.6814.31%2.21%8.45%21.74%
73
Outperform
$474.19M10.7416.69%2.93%27.27%39.43%
69
Neutral
$452.82M24.414.37%3.67%38.01%-58.08%
62
Neutral
C$15.14B6.4223.28%5.45%33.61%-23.38%
60
Neutral
$416.81M16.43-5.24%7.13%-6.64%-233.17%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
FBIZ
First Business Financial
48.80
3.89
8.66%
FFIC
Flushing Financial
12.48
-1.58
-11.24%
GCBC
Greene County Bancorp
24.75
-10.67
-30.12%
NRIM
Northrim Bancorp
85.89
19.01
28.42%
COFS
ChoiceOne Financial Services
30.22
3.86
14.64%
TCBX
Third Coast Bancshares
37.12
13.42
56.62%

First Business Financial Corporate Events

Business Operations and StrategyFinancial Disclosures
First Business Financial Reports Strong Q2 2025 Performance
Positive
Jul 24, 2025

On July 24, 2025, First Business Financial Services, Inc. reported a strong financial performance for the second quarter of 2025, with a net income of $11.2 million, reflecting growth in loans, deposits, and private wealth management. The company achieved significant growth in operating revenue and net income, supported by an effective relationship-based growth strategy and operational efficiency, contributing to a 14% increase in tangible book value from the previous year.

The most recent analyst rating on (FBIZ) stock is a Buy with a $53.00 price target. To see the full list of analyst forecasts on First Business Financial stock, see the FBIZ Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
First Business Financial Expands Board, Appoints New Director
Positive
May 7, 2025

On May 1, 2025, First Business Financial Services, Inc. expanded its Board of Directors from seven to eight members and appointed Jason R. Graham as a Class II Director. Mr. Graham, a seasoned financial executive with a strong background in financial strategy and capital allocation, was also appointed to the Audit Committee. His extensive experience in financial leadership roles at various companies is expected to contribute significantly to the company’s strategic growth and shareholder value creation.

Executive/Board ChangesBusiness Operations and Strategy
First Business Financial Announces CEO Retirement Plan
Positive
May 5, 2025

On May 5, 2025, First Business Financial Services, Inc. announced that its CEO, Corey Chambas, will retire on May 2, 2026, with President and COO Dave Seiler set to succeed him. Chambas, who has been with the company since 1993 and CEO since 2006, will remain on the board of directors. The transition is expected to be smooth, with Seiler’s extensive experience in the banking industry and his alignment with the company’s culture and strategic vision. This leadership change is seen as a continuation of the company’s growth and commitment to its stakeholders.

Business Operations and StrategyFinancial Disclosures
First Business Financial Highlights Strong Q1 2025 Performance
Positive
Apr 30, 2025

On April 30, 2025, First Business Financial Services, Inc. released an investor presentation highlighting its strong first-quarter performance for 2025. The company reported a 14% growth in tangible book value, driven by robust loan and deposit growth, and stable asset quality. Private wealth management assets reached a record $3.425 billion, with fee income increasing by 12.2% compared to the previous year. The company’s strategic plan aims to build long-term shareholder value by focusing on deposit efficiency, profitability, and operational excellence. Despite challenges in the banking sector, First Business Financial Services maintains a strong market position with a focus on sustainable growth and profitability.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jul 29, 2025