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Franklin Financial Services Corporation (FRAF)
NASDAQ:FRAF

Franklin Financial Services (FRAF) AI Stock Analysis

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Franklin Financial Services

(NASDAQ:FRAF)

Rating:71Outperform
Price Target:
$40.00
â–²(6.64%Upside)
Franklin Financial Services displays solid financial performance with strong revenue growth and robust cash flows, which are the primary drivers of its stock score. Technical indicators suggest moderate bearish momentum, while the stock's valuation is fair with an attractive dividend yield. The recent dividend increase further underscores the company's financial strength.

Franklin Financial Services (FRAF) vs. SPDR S&P 500 ETF (SPY)

Franklin Financial Services Business Overview & Revenue Model

Company DescriptionFranklin Financial Services Corporation operates as the bank holding company for Farmers and Merchants Trust Company of Chambersburg that provides commercial, retail banking, and trust services to small and medium-sized businesses, individuals, governmental entities, and non-profit organizations in Pennsylvania. It offers various deposit products, including checking, savings, money management, and time deposit accounts, as well as demand deposits. The company also provides commercial real estate, construction and land development, agricultural, commercial and industrial, and residential mortgage loans, as well as installment and revolving loans to consumers; and secured and unsecured commercial and industrial loans, including accounts receivable and inventory financing, and commercial equipment financing. In addition, it offers various investment and trust services comprising estate planning and administration, corporate and personal trust fund management, pension, and profit sharing and other employee benefit funds management services, as well as custodial services; sells mutual funds, annuities, and insurance products; and offers safe deposit facilities and fiduciary services. Further, the company, through its subsidiary, Franklin Future Fund Inc., operates as a non-bank investment company that makes venture capital investments. It operates twenty-two community banking offices in Franklin, Cumberland, Fulton, and Huntingdon counties, Pennsylvania. Franklin Financial Services Corporation was founded in 1906 and is headquartered in Chambersburg, Pennsylvania.
How the Company Makes MoneyFranklin Financial Services makes money through a variety of revenue streams primarily focused on interest income from loans and mortgages offered to individuals and businesses. Additionally, the company generates fees from account services, transaction fees, and investment management services. Other significant revenue contributors include advisory services and income from securities investments. The company may also benefit from partnerships with other financial institutions to offer co-branded financial products, enhancing its earnings potential.

Franklin Financial Services Financial Statement Overview

Summary
Franklin Financial Services demonstrates solid financial health with strong revenue growth, a sound balance sheet with manageable leverage, and robust cash flows providing ample liquidity for future growth. However, net profit margins are slightly lower due to increased operational costs, and significant investment outflows could affect short-term liquidity.
Income Statement
75
Positive
Franklin Financial Services has shown solid growth with a revenue increase in recent periods. The TTM gross profit margin stands at 59.6%, indicating strong profitability. The net profit margin is at 9.9%, reflecting stable earnings, though slightly lower compared to previous periods due to increased operational costs. Revenue growth rate has been robust, showcasing the company's ability to expand its revenue base effectively.
Balance Sheet
80
Positive
The balance sheet exhibits strength with a debt-to-equity ratio of 1.48, which is manageable and indicates prudent leveraging. Return on Equity (ROE) is at 7.7%, suggesting efficient use of equity to generate profits. The equity ratio is 6.7%, showing a stable capital structure with a focus on maintaining equity levels.
Cash Flow
70
Positive
The cash flow statement reveals healthy operational cash flows, with an operating cash flow to net income ratio of 2.00, indicating good cash generation relative to earnings. Free cash flow growth shows positive trends, enhancing liquidity and financial flexibility. However, the cash flow from investing activities is negative, reflecting significant investments which could impact short-term liquidity.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue117.44M113.83M90.38M70.27M63.98M59.94M
Gross Profit69.99M67.91M64.53M64.76M63.18M51.33M
EBITDA16.23M15.40M17.77M18.93M24.22M14.39M
Net Income11.66M11.10M13.60M14.94M19.62M12.80M
Balance Sheet
Total Assets2.26B2.20B1.84B1.70B1.77B1.54B
Cash, Cash Equivalents and Short-Term Investments531.00M524.10M501.87M565.71M715.45M466.83M
Total Debt223.96M223.96M154.48M25.77M24.45M24.89M
Total Liabilities2.11B2.05B1.70B1.59B1.62B1.39B
Stockholders Equity151.39M144.72M132.14M114.20M157.06M145.18M
Cash Flow
Free Cash Flow21.32M19.19M26.07M13.03M17.54M5.95M
Operating Cash Flow23.27M21.75M26.57M25.24M26.35M6.43M
Investing Cash Flow-204.57M-184.37M-178.27M-95.06M-133.94M-277.31M
Financing Cash Flow223.68M343.08M109.94M-40.44M225.59M244.20M

Franklin Financial Services Technical Analysis

Technical Analysis Sentiment
Positive
Last Price37.51
Price Trends
50DMA
37.29
Positive
100DMA
36.85
Positive
200DMA
34.28
Positive
Market Momentum
MACD
-0.07
Negative
RSI
64.22
Neutral
STOCH
89.65
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FRAF, the sentiment is Positive. The current price of 37.51 is above the 20-day moving average (MA) of 35.49, above the 50-day MA of 37.29, and above the 200-day MA of 34.28, indicating a bullish trend. The MACD of -0.07 indicates Negative momentum. The RSI at 64.22 is Neutral, neither overbought nor oversold. The STOCH value of 89.65 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FRAF.

Franklin Financial Services Risk Analysis

Franklin Financial Services disclosed 3 risk factors in its most recent earnings report. Franklin Financial Services reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
Changes to trade policies and tariffs can have an adverse impact on our business and our customers. Q1, 2025

Franklin Financial Services Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
$157.18M10.5411.08%3.09%15.79%27.67%
77
Outperform
$216.78M10.039.12%1.96%6.42%24.08%
71
Outperform
$164.60M14.158.16%3.56%18.74%-16.38%
70
Outperform
$157.77M9.839.64%3.58%12.41%34.20%
68
Neutral
$162.98M14.426.52%4.38%8.65%14.91%
67
Neutral
$16.89B11.809.79%3.77%12.07%-8.35%
65
Neutral
$178.65M9.1811.31%2.48%6.76%161.37%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
FRAF
Franklin Financial Services
37.51
11.17
42.41%
ATLO
Ames National
18.38
-0.10
-0.54%
FSFG
First Savings Financial Group
26.33
9.03
52.20%
LARK
Landmark Bancorp
27.44
9.51
53.04%
ISTR
Investar Holding
22.17
7.04
46.53%
MRBK
Meridian Bank
14.10
3.76
36.36%

Franklin Financial Services Corporate Events

Dividends
Franklin Financial Services Increases Dividend for Q2 2025
Positive
Apr 14, 2025

On April 10, 2025, Franklin Financial Services Corporation announced an increase in its regular cash dividend to $0.33 per share for the second quarter of 2025, up from $0.32 in the previous quarter and the same quarter of the previous year. This 3.1% increase reflects the company’s commitment to providing value to its shareholders, with the dividend payable on May 28, 2025, to shareholders recorded by May 2, 2025.

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 02, 2025