Financial Institutions (FISI) AI Stock Analysis

• Market Cap: $594.92M
• Dividend Yield: 3.89%
• Average Volume (3M): 141.67K
• Price to Earnings (P/E): 8.4
• Beta (1Y): 1.02
• Revenue Growth: -28.00%
• EPS Growth: -174.60%
• Country: US
• Employees: 598
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.96
• Shares Outstanding: 19,634,210
• 10 Day Avg. Volume: 155,015
• 30 Day Avg. Volume: 141,667
• PEG Ratio: -0.04
• Price to Book (P/B): 1.00
• Price to Sales (P/S): 1.66
• P/FCF Ratio: 46.06
• Enterprise Value/Market Cap: 1.17
• Enterprise Value/Revenue: 1.84
• Enterprise Value/Gross Profit: 2.99
• Enterprise Value/Ebitda: 7.16
• 1Y Price Target: $37.00
• Price Target Upside: 22.11% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 3.84
• Revenue Forecast (FY): $258.49M

• Rating: 66 Neutral
• Price Target: $33.00 ▲(8.91% Upside)
• Action: Reiterated Date: 03/10/26
• Date: Action: Reiterated 03/10/26

The score is driven by a solid but uneven financial profile (strong 2025 rebound but historically volatile earnings/cash flow) and attractive valuation (low P/E and ~4% dividend). These positives are partially offset by weak near-term technicals (negative MACD and price below key moving averages), while the latest earnings call guidance was supportive overall.

Positive Factors

Profitability rebound and margin expansion

A material 2025 rebound—sharp revenue growth with NIM expansion and double-digit ROE—demonstrates restored core earnings power. If management sustains mid‑3.6% NIM and guided efficiency targets, this supports durable internal capital generation, dividends and reinvestment over the medium term.

Stronger capital and proactive funding actions

Refinancing high-cost debt via the $80M subordinated placement and modest buybacks reflect active capital management. The CET1 build and improved funding mix increase balance-sheet flexibility, reducing refinancing risk and supporting measured capital returns and strategic investments over time.

Growing fee income and AUM expansion

Significant AUM growth and rising advisory/swap fees diversify revenue away from net interest income. Recurring fee streams and higher AUM provide more stable, less rate-sensitive income that can smooth earnings cycles and support client relationships and cross-sell opportunities long term.

Negative Factors

Volatile cash generation and earnings

Marked year-to-year swings in operating and free cash flow reduce predictability of internal funding for dividends, buybacks and loan growth. This volatility raises funding and provisioning risk, making capital allocation decisions more conservative and limiting strategic flexibility in downturns.

Deposit pressure and BaaS wind-down

Seasonal outflows combined with the BaaS wind-down materially change funding composition. Reduced core deposit balances and concentrated funding shifts can increase reliance on pricier wholesale or time-based funding, pressuring NIM and constraining stable loan funding over multiple quarters.

Margin sensitivity and intentional loan runoff

Earnings are exposed to interest‑rate timing and funding actions; NIM compressions from subordinated debt timing and intentional runoff of indirect loans reduce yield-bearing assets. Persistent sensitivity raises the risk that margins and earnings could fluctuate materially across rate cycles.

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.

Financial Institutions Financial Statement Overview

Summary

2025 showed a strong rebound (sharp revenue growth and a return to solid profitability), and leverage looks reasonable with improving capital metrics. However, results and cash generation have been notably volatile across years, and 2025 free cash flow declined versus 2024, which tempers confidence in consistency.

Income Statement

Earnings power improved materially in 2025 versus 2024, with revenue up sharply (+41.7%) and profitability rebounding from a net loss in 2024 to a ~19.8% net margin in 2025. Longer-term, results have been volatile: strong profitability in 2020–2023, a pronounced downturn in 2024 (negative operating profit and net loss), then a recovery in 2025. Margins in 2025 are solid but still below the peak levels seen in 2021–2022, keeping the score in the mid-range despite the strong latest-year rebound.

Balance Sheet

Leverage appears reasonable for a regional bank, with debt-to-equity in the ~0.45–0.48 range in 2024–2025 (improved from higher leverage in 2022–2023), and equity building over time. Returns on equity are healthy in profitable years (about 11.9% in 2025), but the 2024 loss drove a negative return on equity, highlighting earnings sensitivity and balance-sheet performance that can swing with operating conditions.

Cash Flow

Cash generation is uneven year-to-year: operating cash flow and free cash flow were strong in 2021–2022, fell sharply in 2023, rebounded in 2024, and then dropped again in 2025 (free cash flow down ~21.7% in 2025). While 2025 free cash flow matches reported net income (supportive quality of earnings in that year), the overall volatility and recent decline in cash generation temper the score.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	377.94M	264.17M	332.59M	241.09M	212.03M
Gross Profit	233.31M	88.03M	197.29M	198.25M	207.89M
EBITDA	91.35M	-60.47M	71.14M	79.08M	105.27M
Net Income	74.87M	-41.65M	50.26M	56.57M	77.70M
Balance Sheet
Total Assets	6.27B	6.12B	6.16B	5.80B	5.52B
Cash, Cash Equivalents and Short-Term Investments	979.61M	87.33M	1.01B	1.08B	1.26B
Total Debt	193.65M	256.61M	343.32M	312.45M	103.91M
Total Liabilities	5.65B	5.55B	5.71B	5.39B	5.02B
Stockholders Equity	628.85M	568.98M	454.80M	405.61M	505.14M
Cash Flow
Free Cash Flow	13.60M	72.15M	7.90M	125.20M	63.56M
Operating Cash Flow	18.80M	77.13M	10.89M	133.57M	72.96M
Investing Cash Flow	-140.04M	-8.23M	-310.09M	-325.16M	-633.42M
Financing Cash Flow	142.67M	-106.02M	293.17M	242.94M	545.69M

Financial Institutions Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 30.30
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 30.3 is below the 20-day moving average (MA) of 31.20, below the 50-day MA of 32.08, and above the 200-day MA of 28.33, indicating a neutral trend. The MACD of -0.64 indicates Positive momentum. The RSI at 37.84 is Neutral, neither overbought nor oversold. The STOCH value of 41.90 is Neutral, 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
TCBX	74 Outperform	$601.40M	7.33	13.12%	―	9.12%	45.83%
UNTY	71 Outperform	$493.61M	8.36	17.76%	1.08%	11.38%	36.10%
CBNK	70 Outperform	$464.90M	7.72	14.72%	1.53%	24.90%	28.06%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
FMNB	67 Neutral	$729.67M	9.18	12.01%	4.95%	3.93%	17.48%
FISI	66 Neutral	$594.92M	8.37	-4.98%	3.89%	-28.00%	-174.60%
BHB	62 Neutral	$518.84M	14.04	7.42%	3.92%	4.26%	-16.52%

Financial Institutions Corporate Events

Financial Institutions Increases Quarterly Dividend, Signals Earnings Confidence

Financial Institutions, Inc., parent of Five Star Bank and Courier Capital, reported on February 12, 2026, that its board approved a 3.2% increase in the quarterly common stock dividend to $0.32 per share, citing strong 2025 profitability, a solid balance sheet and confidence in sustainable long-term earnings growth. The higher dividend equates to a 3.7% yield and a 35% payout ratio on 2025 net income and is payable on April 2, 2026 to shareholders of record on March 13, 2026, alongside declared dividends on the company’s Series A 3% and Series B-1 8.48% preferred stock, reinforcing its strategy of returning capital to investors while continuing to invest in its franchise and communities.

The most recent analyst rating on (FISI) stock is a Hold with a $36.00 price target. To see the full list of analyst forecasts on Financial Institutions stock, see the FISI Stock Forecast page.

Financial Institutions Posts Strong Q4 2025 Earnings Turnaround

On January 29, 2026, Financial Institutions, Inc. reported that net income available to common shareholders reached $19.6 million, or $0.96 per diluted share, for the fourth quarter of 2025 and $73.4 million, or $3.61 per diluted share, for full-year 2025, marking a strong turnaround from net losses a year earlier. Results were driven by record quarterly and annual net interest income of $52.2 million and $200.0 million, a 67-basis-point year-over-year expansion in full-year net interest margin to 3.53%, and solid noninterest income supported by swap activity, higher advisory fees and income from a life insurance redeployment strategy. The company grew total loans to $4.66 billion, led by 7.5% annual commercial loan growth, while deposits rose 2.0% year-over-year despite seasonal and funding mix pressures, and it maintained stable credit quality with an allowance for credit losses of 1.02% of loans at year-end. Capital strength underpinned a December 2025 private placement of $80 million of BBB–rated subordinated notes, used in part to refinance $65 million of higher-cost 2015 and 2020 debt in January 2026, and supported the repurchase of 336,869 common shares, or 1.7% of shares outstanding, in the fourth quarter, reinforcing management’s confidence in its earnings trajectory and long-term value strategy.

The most recent analyst rating on (FISI) stock is a Hold with a $34.00 price target. To see the full list of analyst forecasts on Financial Institutions stock, see the FISI Stock Forecast page.

Financial Institutions Completes $80M Subordinated Notes Placement

On December 11, 2025, Financial Institutions, Inc. completed a private placement of $80 million in subordinated notes due 2035, with a fixed-to-floating interest rate structure. The proceeds will be used to redeem $65 million of higher-interest outstanding debt and for general corporate purposes. This strategic move is expected to temporarily elevate the company’s Total Risk-Based Capital ratio by approximately 150 basis points at year-end, reflecting improved profitability and capital position. The notes received a BBB- rating from Kroll Bond Rating Agency, indicating a stable long-term outlook for the company.

The most recent analyst rating on (FISI) stock is a Hold with a $33.00 price target. To see the full list of analyst forecasts on Financial Institutions stock, see the FISI Stock Forecast page.