Live Oak Bancshares (LOB) AI Stock Analysis

• Market Cap: $1.77B
• Dividend Yield: 0.32%
• Average Volume (3M): 286.76K
• Price to Earnings (P/E): 31.7
• Beta (1Y): 1.27
• Revenue Growth: 10.13%
• EPS Growth: -50.08%
• Country: US
• Employees: 1,008
• Sector: Financial
• Sector Strength: 78
• Industry: Banks - Regional
• EPS (TTM): 0.51
• Shares Outstanding: 45,731,300
• 10 Day Avg. Volume: 337,097
• 30 Day Avg. Volume: 286,760
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.46
• Enterprise Value/Revenue: 0.84
• Enterprise Value/Gross Profit: 2.05
• Enterprise Value/Ebitda: 7.97
• 1Y Price Target: $43.00
• Price Target Upside: 14.42% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 73 Outperform
• Price Target: $43.00 ▲(14.42% Upside)

Live Oak Bancshares' strong financial performance, positive earnings call, and strategic corporate events contribute significantly to its overall score. While technical indicators suggest caution due to overbought conditions, the company's robust growth prospects and strategic initiatives position it well for future success.

Positive Factors

Analyst Recommendation

Analyst upgrades LOB to Outperform due to expected positive catalysts that could drive shares higher.

Earnings Growth

LOB is projected to have top-decile earnings growth, significantly enhancing returns and financial performance.

Valuation

LOB shares are trading at a significant discount to historical valuation, suggesting a strong potential for price appreciation.

Negative Factors

Credit Performance

Credit performance is anticipated to improve, which should ease investor concerns and drive valuation recovery.

Investor Sentiment

Credit performance is set to improve in the second half of 2025, which should ease investor fears.

Risk/Reward Balance

The potential upside is nearly three times larger than the estimated downside, indicating a very attractive risk/reward for investors.

Live Oak Bancshares Business Overview & Revenue Model

Company Description

Live Oak Bancshares, Inc. is a bank holding company headquartered in Wilmington, North Carolina. It primarily operates through its wholly-owned subsidiary, Live Oak Bank, which focuses on providing financial services to small businesses across various sectors, including healthcare, agriculture, and commercial industries. The company offers a range of products and services such as business loans, deposit accounts, and treasury management solutions, with a strong emphasis on technology-driven banking solutions to enhance customer experience and operational efficiency.

How the Company Makes Money

Live Oak Bancshares generates revenue primarily through interest income from loans provided to small businesses, which is a significant component of its earnings. The company specializes in lending to niche industries, allowing it to charge competitive interest rates on its loans. Additionally, Live Oak earns non-interest income through fees associated with its deposit accounts, loan origination, and servicing. The bank's revenue model is further supported by its investment in technology that streamlines the lending process, reducing costs and increasing efficiency. Strategic partnerships with industry-specific organizations also contribute to its revenue by enhancing its market reach and customer acquisition efforts.

Live Oak Bancshares Financial Statement Overview

Summary

Live Oak Bancshares exhibits strong financial performance with robust revenue growth and profitability. The company maintains low leverage and strong cash flows, although there is room for improvement in net profit margins and return on equity.

Income Statement

Live Oak Bancshares demonstrated strong revenue growth with a notable increase in total revenue from previous periods. The TTM (Trailing-Twelve-Months) gross profit margin is healthy at approximately 41.2%, indicating efficient cost management. The net profit margin stands at 6.3%, which is slightly lower than last year's due to increased operational expenses. EBIT and EBITDA margins are respectable at 8.5% and 11.2%, respectively. Overall, the income statement reflects a solid growth trajectory with stable profitability.

Balance Sheet

The balance sheet of Live Oak Bancshares reflects a strong equity position with an equity ratio of 7.6%, maintaining sound capital adequacy. The debt-to-equity ratio is low at 0.11, indicating minimal leverage and low financial risk. Return on equity (ROE) is solid at 5.8%, though it has decreased slightly compared to the previous year, suggesting room for improvement in profitability. Overall, the balance sheet shows stability with a focus on maintaining low leverage.

Cash Flow

The cash flow statement highlights robust operating cash flow, significantly exceeding net income, indicating effective cash management. The free cash flow growth rate is positive, reflecting strong cash generation capabilities. Operating cash flow to net income ratio is high at 9.2, and the free cash flow to net income ratio is also strong at 8.7, demonstrating a solid cash conversion ability. Overall, the cash flow position is strong, supported by effective cash generation and management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	971.60M	929.29M	776.55M	508.83M	506.41M	378.31M
Gross Profit	396.63M	396.61M	382.26M	350.92M	426.77M	243.97M
EBITDA	102.12M	112.52M	104.10M	231.11M	232.15M	69.08M
Net Income	56.07M	77.47M	73.90M	176.21M	167.00M	59.54M
Balance Sheet
Total Assets	13.83B	12.94B	11.27B	9.86B	8.21B	7.87B
Cash, Cash Equivalents and Short-Term Investments	1.39B	634.39M	1.71B	1.30B	1.10B	1.05B
Total Debt	107.66M	112.82M	23.35M	83.20M	318.29M	1.54B
Total Liabilities	12.76B	11.94B	10.37B	9.04B	7.50B	7.30B
Stockholders Equity	1.06B	999.03M	902.67M	811.03M	715.13M	567.85M
Cash Flow
Free Cash Flow	660.70M	487.16M	573.23M	80.73M	-122.80M	-281.99M
Operating Cash Flow	674.85M	536.47M	620.07M	124.48M	-119.72M	-261.00M
Investing Cash Flow	-2.50B	-2.08B	-1.77B	-1.44B	-149.80M	-2.62B
Financing Cash Flow	1.87B	1.57B	1.32B	1.53B	154.95M	2.98B

Live Oak Bancshares Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 37.58
• 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 LOB, the sentiment is Positive. The current price of 37.58 is above the 20-day moving average (MA) of 35.22, above the 50-day MA of 33.09, and above the 200-day MA of 33.16, indicating a bullish trend. The MACD of 1.68 indicates Negative momentum. The RSI at 67.15 is Neutral, neither overbought nor oversold. The STOCH value of 72.28 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LOB.

Live Oak Bancshares Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NBHC	80 Outperform	$1.49B	12.65	9.15%	3.02%	0.60%	-6.31%
STBA	79 Outperform	$1.52B	11.62	9.47%	3.46%	-0.57%	-3.92%
LOB	73 Outperform	$1.77B	31.66	5.54%	0.32%	10.13%	-50.08%
CCB	69 Neutral	$1.73B	35.19	12.23%	―	9.22%	18.60%
Sector *	68 Neutral	$17.95B	11.54	10.27%	3.74%	9.64%	1.17%
TFIN	68 Neutral	$1.46B	139.12	1.52%	―	2.02%	-60.54%
HOPE	65 Neutral	$1.43B	31.08	1.92%	5.06%	-12.55%	-59.97%

Live Oak Bancshares Corporate Events

Live Oak Bancshares CEO Announces Stock Trading Plan

On August 27, 2025, James S. Mahan III, Chairman and CEO of Live Oak Bancshares, announced a prearranged stock trading plan to sell up to 400,000 shares of his holdings. This plan, part of his personal financial and tax strategies, will be executed from November 2025 through September 2026, adhering to Rule 10b5-1 under the Securities Exchange Act of 1934.

Live Oak Bancshares Declares Cash Dividend Announcement

On August 19, 2025, Live Oak Bancshares‘ Board of Directors declared a cash dividend of $0.03 per share for its Voting Common Stock and $0.23845 per depositary share for its 8.375% Fixed Rate Series A Non-Cumulative Perpetual Preferred Stock, to be paid on September 15, 2025, to shareholders recorded by September 2, 2025.

Live Oak Bancshares Gains from Apiture Acquisition Deal

On August 19, 2025, Computer Services Inc. announced its definitive agreement to acquire Apiture, Inc., in which Live Oak Banking Company holds an investment. This transaction will see Apiture become a wholly owned subsidiary of CSI, with Live Oak Banking Company receiving a portion of the merger consideration. The deal is expected to bring Live Oak Bancshares an estimated pre-tax gain of $20 million to $25 million, while also ceasing further pass-through losses from the investment.

Live Oak Bancshares Appoints Jeffrey Lunsford to Board

On August 12, 2025, Live Oak Bancshares appointed Jeffrey W. Lunsford to its board of directors and to the board of Live Oak Bank. Lunsford, a seasoned technology executive with significant experience in fintech and software companies, is expected to bring valuable expertise as Live Oak aims to innovate in the financial services sector. His appointment is seen as a strategic move to bolster the company’s mission of becoming a leading small business bank in America.

Live Oak Bancshares Completes Preferred Stock Offering

On August 4, 2025, Live Oak Bancshares, Inc. announced the completion of its underwritten offering of 4,000,000 depositary shares, each representing a 1/40th interest in a share of its 8.375% Fixed Rate Series A Non-Cumulative Perpetual Preferred Stock. This offering, which was made under a shelf registration statement filed with the SEC, resulted in net proceeds of approximately $96,150,000 for the company. The issuance of these shares marks a significant financial maneuver for Live Oak, potentially enhancing its capital structure and market positioning.

Live Oak Bancshares Announces Public Offering Pricing

On July 28, 2025, Live Oak Bancshares, Inc. announced the pricing of an underwritten public offering of 4,000,000 depositary shares, each representing a 1/40th ownership interest in the company’s Series A Preferred Stock. The offering is expected to close on or about August 4, 2025, with net proceeds intended for general corporate purposes, including supporting balance sheet growth and enhancing capital position.