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Orrstown Financial Services (ORRF)
:ORRF
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Orrstown Financial Services
(NASDAQ:ORRF)
Select Model
Select Model
Rating:81Outperform
Price Target:
$42.00
â–²(20.55% Upside)
Orrstown Financial Services receives a strong overall score due to its robust financial performance, positive earnings call highlights, and attractive valuation. While technical indicators suggest potential for a short-term pullback, the company's strategic flexibility and growth prospects support a positive outlook.
Positive Factors
Revenue Growth
Consistent revenue growth indicates a strong market position and effective business strategies, supporting long-term financial stability.
Loan Growth
Robust loan growth reflects effective lending strategies and strong demand, contributing to sustainable revenue and profit expansion.
Cash Generation
Strong cash generation enhances financial flexibility, allowing for strategic investments and debt management, supporting long-term growth.
Negative Factors
Nonaccrual Loans
Rising nonaccrual loans can indicate credit quality issues, potentially impacting profitability and increasing risk exposure.
Competitive Pressure
Intense competition may pressure margins, affecting profitability and necessitating strategic adjustments to maintain market position.
Asset Sensitivity
Asset sensitivity to interest rate changes could lead to margin contraction, impacting earnings and requiring careful management of interest rate risks.
Orrstown Financial Services (ORRF) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$720.28M
Dividend Yield2.79%
Average Volume (3M)177.48K
Price to Earnings (P/E)9.8
Beta (1Y)0.86
Revenue Growth47.65%
EPS Growth101.00%
CountryUS
Employees607
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)1.13
Shares Outstanding19,498,770
10 Day Avg. Volume225,689
30 Day Avg. Volume177,477
Financial Highlights & Ratios
PEG Ratio-0.43
Price to Book (P/B)1.05
Price to Sales (P/S)1.90
P/FCF Ratio16.19
Enterprise Value/Market Cap1.24
Enterprise Value/Revenue2.48
Enterprise Value/Gross Profit3.86
Enterprise Value/Ebitda12.70
Forecast
1Y Price Target
$40.50Price Target Upside16.25% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Orrstown Financial Services Business Overview & Revenue Model
Company DescriptionOrrstown Financial Services (ORRF) is a diversified financial services company headquartered in Pennsylvania. It primarily operates through its subsidiary, Orrstown Bank, which offers a wide range of banking products and services, including personal and commercial banking, wealth management, and mortgage lending. The company is dedicated to serving individuals, families, and businesses in its local communities, providing tailored financial solutions and exceptional customer service.
How the Company Makes MoneyOrrstown Financial Services generates revenue through several key streams. The primary source of income is from net interest income, which is derived from the interest earned on loans and securities, minus the interest paid on deposits. Additionally, the company earns non-interest income through fees associated with banking services, wealth management, and mortgage origination. Significant partnerships with local businesses and organizations enhance its market reach and customer base, contributing positively to its financial performance. Furthermore, investment in technology and customer service initiatives helps drive growth and retention, ultimately influencing the company's profitability.
Orrstown Financial Services Earnings Call Summary
Earnings Call Date:Oct 21, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Jan 27, 2026
Earnings Call Sentiment Positive
The earnings call highlighted strong financial performance with notable growth in loans, improved net interest margin, and record earnings. However, concerns about increasing nonaccrual loans and competitive pressures affecting net interest margin were also discussed.Q3-2025 Updates
Positive Updates
Strong Loan Growth
Achieved a 4.9% annualized loan growth in the third quarter, demonstrating strong performance after aligning the acquired portfolio with the company's risk profile.
Net Interest Margin Improvement
Net interest margin increased to 4.11% in Q3 from 4.07% in Q2, indicating effective pricing and funding cost management.
Record Quarterly Earnings
Reported the strongest quarter of earnings on record with diluted EPS of $1.13, a return on assets of 1.60%, and a return on equity of nearly 16%.
Fee Income Stability
Fee income remained a core strength, accounting for 20.8% of operating revenue, maintaining nearly 21% for two consecutive quarters.
Reduction in Noninterest Expense
Noninterest expense declined by $1.3 million compared to the prior quarter, improving the efficiency ratio from 60.3% to 56.4%.
Capital Position Strength
The company is well-capitalized by all measures, providing significant strategic flexibility for future growth.
Negative Updates
Increase in Nonaccrual Loans
Nonaccrual loans increased by $3.8 million to $26.2 million, primarily due to one relationship within the commercial construction and development portfolio.
Competitive Pressure on NIM
Heavy competition on both loan and deposit pricing is expected to influence the ability to maintain or increase the net interest margin.
Asset Sensitivity Concerns
Being asset sensitive, margins are expected to contract as rates come down, with competition further impacting pricing strategies.
Company Guidance
During the Orrstown Financial Services, Inc. Third Quarter 2025 Earnings Conference Call, the company provided several positive financial metrics reflecting their strong performance. The company reported a 4.9% annualized loan growth, demonstrating a robust lending strategy. Their net interest margin improved slightly to 4.11% from 4.07% in the previous quarter, showcasing effective loan pricing and funding cost management. Fee income remained strong, comprising 20.8% of operating revenue. Additionally, noninterest expenses decreased by $1.3 million, resulting in a more efficient operation with an efficiency ratio dropping from 60.3% to 56.4%. These efforts culminated in a record quarterly earnings with a diluted EPS of $1.13, a return on assets of 1.60%, and a return on equity nearly reaching 16%. Overall, the company expressed optimism about sustaining this growth trajectory while maintaining robust credit quality and strategic flexibility in capital management.Orrstown Financial Services Financial Statement Overview
Summary
Orrstown Financial Services demonstrates strong financial health with consistent revenue and profit growth. The balance sheet reflects a stable financial position with manageable leverage. Cash flow generation is robust, although there is room for improvement in cash conversion efficiency. Overall, the company is well-positioned for continued growth and stability.Income Statement
Orrstown Financial Services shows strong revenue growth with a TTM increase of 4.12%. The gross profit margin is robust at 74.88%, indicating efficient cost management. Net profit margin improved to 14.04%, reflecting enhanced profitability. EBIT and EBITDA margins are healthy, supporting operational efficiency.85
Very Positive
Balance Sheet
The company's debt-to-equity ratio is moderate at 0.46, suggesting a balanced approach to leveraging. Return on equity is reasonable at 8.19%, indicating effective use of equity to generate profits. The equity ratio is stable, reflecting a solid capital structure.78
Positive
Cash Flow
Free cash flow growth is impressive at 58.80%, showcasing strong cash generation capabilities. The operating cash flow to net income ratio is low, suggesting potential areas for improvement in cash conversion. However, the free cash flow to net income ratio is high at 91.06%, indicating efficient cash utilization.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 358.64M | 284.09M | 174.30M | 134.32M | 121.64M | 126.88M |
| Gross Profit | 230.84M | 173.86M | 127.62M | 121.11M | 113.83M | 105.53M |
| EBITDA | 70.15M | 37.50M | 49.37M | 31.24M | 46.20M | 39.08M |
| Net Income | 43.28M | 22.05M | 35.66M | 22.04M | 32.88M | 26.46M |
Balance Sheet | ||||||
| Total Assets | 5.39B | 5.44B | 3.06B | 2.92B | 2.83B | 2.75B |
| Cash, Cash Equivalents and Short-Term Investments | 815.51M | 1.08B | 578.68M | 574.55M | 681.15M | 591.72M |
| Total Debt | 235.40M | 209.91M | 179.38M | 155.42M | 57.16M | 109.41M |
| Total Liabilities | 4.84B | 4.92B | 2.80B | 2.69B | 2.56B | 2.50B |
| Stockholders Equity | 548.45M | 516.68M | 265.06M | 228.90M | 271.66M | 246.25M |
Cash Flow | ||||||
| Free Cash Flow | 46.70M | 33.38M | 41.41M | 35.30M | 39.56M | 28.87M |
| Operating Cash Flow | 51.29M | 34.96M | 43.70M | 36.19M | 40.81M | 30.17M |
| Investing Cash Flow | 91.62M | 60.99M | -153.25M | -270.99M | -2.01M | -292.56M |
| Financing Cash Flow | -126.03M | 87.76M | 113.89M | 86.91M | 44.65M | 331.47M |
Orrstown Financial Services Technical Analysis
Positive
34.84
Price Trends
34.26
Positive
34.04
Positive
31.97
Positive
Market Momentum
0.97
Negative
73.72
Negative
85.59
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ORRF, the sentiment is Positive. The current price of 34.84 is below the 20-day moving average (MA) of 35.59, above the 50-day MA of 34.26, and above the 200-day MA of 31.97, indicating a bullish trend. The MACD of 0.97 indicates Negative momentum. The RSI at 73.72 is Negative, neither overbought nor oversold. The STOCH value of 85.59 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ORRF.
Orrstown Financial Services Risk Analysis
Orrstown Financial Services disclosed 52 risk factors in its most recent earnings report. Orrstown Financial Services reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Orrstown Financial Services Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $720.28M | 9.78 | 13.43% | 2.79% | 47.65% | 101.00% | |
80 Outperform | $782.05M | 13.59 | 13.95% | 2.19% | 22.24% | 18.63% | |
78 Outperform | $732.73M | 9.90 | 12.46% | 3.18% | 16.57% | 69.64% | |
77 Outperform | $633.93M | 9.30 | 11.18% | 2.53% | 0.67% | 17.88% | |
77 Outperform | $729.69M | 12.29 | 9.49% | 3.79% | 24.08% | 9.83% | |
74 Outperform | $878.22M | 13.34 | 7.84% | 0.67% | 14.04% | 337.54% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
ORRF
Orrstown Financial Services
38.06
0.53
1.41%
CAC
Camden National
44.70
0.72
1.64%
THFF
First Financial Indiana
64.18
16.52
34.66%
GSBC
Great Southern Bancorp
65.02
0.94
1.47%
FSBC
Five Star
37.16
4.95
15.39%
NBBK
NB Bancorp, Inc.
20.90
0.70
3.47%
Orrstown Financial Services Corporate Events
Orrstown Financial Services Reports Record Earnings Amid Growth
Oct 24, 2025
The latest earnings call from Orrstown Financial Services painted a picture of robust financial health, characterized by notable growth in loans, an improved net interest margin, and record-breaking earnings. However, the discussion was tempered by concerns over rising nonaccrual loans and competitive pressures that could impact future net interest margins.
Business Operations and StrategyPrivate Placements and Financing
Orrstown Financial Approves $32.5M Notes Redemption
Neutral
Aug 29, 2025
On August 27, 2025, Orrstown Financial Services‘ Board of Directors approved the redemption of $32.5 million in outstanding subordinated notes due in 2028, with the redemption set for September 30, 2025. This strategic financial move will involve redeeming the notes at their principal amount plus any accrued interest, potentially impacting the company’s financial structure and stakeholder interests.
The most recent analyst rating on (ORRF) stock is a Buy with a $37.00 price target. To see the full list of analyst forecasts on Orrstown Financial Services stock, see the ORRF Stock Forecast page.
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.