Katahdin Bankshares (KTHN) AI Stock Analysis

• Market Cap: $107.85M
• Dividend Yield: 2.8%
• Average Volume (3M): 265.00
• Price to Earnings (P/E): 7.3
• Beta (1Y): 0.26
• Revenue Growth: 7.63%
• EPS Growth: 8.12%
• Country: US
• Employees: 174
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.99
• Shares Outstanding: 3,401,000
• 10 Day Avg. Volume: 200
• 30 Day Avg. Volume: 265
• PEG Ratio: 0.26
• Price to Book (P/B): 0.89
• Price to Sales (P/S): 1.48
• P/FCF Ratio: 8.20
• Enterprise Value/Market Cap: 0.89
• Enterprise Value/Revenue: 1.76
• Enterprise Value/Gross Profit: 2.35
• Enterprise Value/Ebitda: 8.85
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: $37.00 ▲(27.98% Upside)
• Action: Reiterated Date: 03/10/26
• Date: Action: Reiterated 03/10/26

The score is driven by solid financial performance (healthy margins, improving leverage, strong cash conversion) and an attractive valuation (low P/E with a dividend). Technicals are supportive due to an uptrend and positive MACD, though near-term momentum looks stretched (high stochastic), which tempers the score.

Positive Factors

Profitability & Margins

Consistently strong margins (2025 net ~17%, EBIT ~21%) provide durable earnings power. Higher margins help absorb credit and funding shocks, support internal reinvestment and moderate dividend capacity, making earnings less dependent on volume recovery alone.

Improving Leverage / Capital Position

Lower and improving leverage (debt-to-equity ~0.29 in 2025 from ~0.38) and steady equity growth strengthen the bank’s capital buffer. Moderate leverage reduces funding and regulatory strain, enabling steady lending, credit loss absorption and strategic flexibility over time.

Strong Cash Generation

High cash conversion (operating cash flow ~$12.4M; FCF ~$11.2M; FCF ~90% of net income) indicates efficient earnings-to-cash mechanics. Reliable cash generation supports loan funding, shareholder distributions and reinvestment without heavy external financing when trends persist.

Negative Factors

Topline Volatility

Sharp revenue swings (2024 decline then 2025 rebound: -25% then +13%) indicate unstable topline drivers. Persistent volatility undermines forecasting, capital planning and credit risk assessment, increasing the risk that earnings and loan growth will be uneven across cycles.

Margins/ROE Below Prior Peaks

Margins and returns have trended down from 2021–2022 peaks and ROE has eased, signaling pressure on spread or expense dynamics. If these structural pressures persist, long-term profitability expansion and return on equity could remain constrained versus prior highs.

Uneven Free Cash Flow Growth

Free cash flow growth has been uneven with declines in several years despite strong FCF in 2025. This inconsistency complicates capital allocation, may constrain sustained dividend increases, and could force reliance on external funding in weaker cash years.

Katahdin Bankshares Business Overview & Revenue Model

Company Description

Katahdin Bankshares Corp. operates as the bank holding company for Katahdin Trust Company, a state-chartered commercial bank that provides a range of commercial and retail banking services for individuals and businesses in Maine. It provides various deposit products comprising checking and savings accounts, money market and NOW accounts, certificates of deposit, individual retirement accounts, and Coverdell education savings accounts. The company also offers mortgage, construction, homebuyer, home equity, rural development, and personal loans; and business loans and lines of credit comprising business term, municipal, and small business administration loans, as well as business mortgages, business letters of credit, agency guaranteed programs. In addition, it provides online and telephone banking, bill payment, and e-check deposit, reorder checks, money and wire transfer, debit and credit cards, gift cards, ATMs, and merchant services. Further, the company offers equipment financing services in the trucking, construction, forest products, and marine industries; and securities and insurance products. It operates 16 full-service branches in northern Maine, greater Bangor, and Portland regions. The company was founded in 1918 and is based in Patten, Maine.

How the Company Makes Money

Katahdin Bankshares generates revenue primarily through interest income from loans and mortgages, which represent a significant portion of its earnings. The company offers various loan products, including personal loans, business loans, and real estate financing, which yield interest payments from borrowers. Additionally, Katahdin Bankshares earns non-interest income through service fees, account maintenance charges, and fees related to investment services. The bank also benefits from strategic partnerships with local businesses and organizations, enhancing its customer base and contributing to overall revenue growth. Furthermore, the bank's emphasis on community engagement and local lending fosters customer loyalty and attracts deposits, which are crucial for funding its lending activities.

Katahdin Bankshares Financial Statement Overview

Summary

Fundamentals are solid: good profitability (2025 net margin ~17%, EBIT margin ~21%), moderate leverage with improving debt-to-equity (~0.29 in 2025), and strong cash conversion (FCF ~90% of net income). The main offset is volatility—revenue swung sharply (2024 decline then 2025 rebound) and margins/returns are below earlier peak levels.

Income Statement

Profitability remains solid, with 2025 net margin at ~17% and EBIT margin at ~21%, supporting consistent earnings power. Revenue rebounded sharply in 2025 (+13% year over year) after a weaker 2024 (-25%), indicating the topline can be volatile. Margins have also trended down from the 2021–2022 peak levels, suggesting some pressure on spread/expense dynamics despite the 2025 growth recovery.

Balance Sheet

Leverage looks moderate for a regional bank, with debt-to-equity improving to ~0.29 in 2025 from ~0.38 in 2024, alongside steady equity growth. Returns on equity are healthy and fairly consistent (roughly 9%–12% over time; ~10% in 2025), signaling decent capital efficiency. The main watch-out is the typical banking sensitivity to cycle and funding conditions, and ROE has eased from earlier highs.

Cash Flow

Cash generation is steady: 2025 operating cash flow (~$12.4M) and free cash flow (~$11.2M) comfortably track earnings, with free cash flow running at ~90% of net income in 2025 (similarly strong in prior years). That said, free cash flow growth has been uneven (declines in several years), pointing to variability in cash conversion and reinvestment needs. Overall cash flow quality is good, but consistency is not as strong as profitability.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	54.69M	62.01M	38.35M	51.21M	40.95M	39.83M
Gross Profit	40.98M	44.32M	38.35M	39.07M	37.28M	35.63M
EBITDA	10.89M	13.18M	9.74M	13.26M	12.96M	12.66M
Net Income	8.92M	10.70M	8.06M	9.91M	9.72M	9.47M
Balance Sheet
Total Assets	1.09B	1.12B	1.08B	1.03B	983.54M	940.50M
Cash, Cash Equivalents and Short-Term Investments	29.00M	37.20M	50.90M	181.27M	177.32M	173.44M
Total Debt	30.00M	30.00M	34.70M	31.53M	22.98M	22.91M
Total Liabilities	991.47M	1.02B	988.52M	946.44M	903.87M	856.89M
Stockholders Equity	95.73M	103.63M	91.80M	87.81M	79.66M	83.60M
Cash Flow
Free Cash Flow	0.00	11.22M	8.83M	9.97M	8.11M	10.85M
Operating Cash Flow	0.00	12.40M	10.22M	11.10M	11.54M	11.64M
Investing Cash Flow	0.00	-54.02M	-24.61M	-55.56M	-78.17M	-3.17M
Financing Cash Flow	0.00	27.91M	38.76M	40.48M	34.22M	-2.50M

Katahdin Bankshares Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 28.91
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KTHN, the sentiment is Positive. The current price of 28.91 is below the 20-day moving average (MA) of 32.13, below the 50-day MA of 30.94, and above the 200-day MA of 27.11, indicating a bullish trend. The MACD of 0.29 indicates Positive momentum. The RSI at 60.98 is Neutral, neither overbought nor oversold. The STOCH value of 58.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KTHN.

Katahdin Bankshares Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KTHN	79 Outperform	$107.85M	7.34	10.84%	2.80%	7.63%	8.12%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
AUBN	66 Neutral	$73.40M	12.98	8.33%	4.16%	24.17%	739.42%
LSBK	63 Neutral	$114.92M	15.00	6.26%	2.12%	2.27%	66.15%
IROQ	62 Neutral	$88.98M	16.46	6.22%	1.48%	1.93%	157.35%
PBHC	54 Neutral	$79.96M	-25.99	-2.75%	2.86%	0.84%	―