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Orrstown Financial Services Inc (ORRF)
NASDAQ:ORRF
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Orrstown Financial Services
(NASDAQ:ORRF)
Rating:68Neutral
Price Target:―
Orrstown Financial Services (ORRF) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$577.84M
Dividend Yield3.11%
Average Volume (3M)145.57K
Price to Earnings (P/E)15.1
Beta (1Y)0.87
Revenue Growth75.72%
EPS Growth-41.36%
CountryUS
Employees607
SectorFinancial
Sector Strength82
IndustryBanks - Regional
Share Statistics
EPS (TTM)1.00
Shares Outstanding19,508,545
10 Day Avg. Volume92,714
30 Day Avg. Volume145,572
Financial Highlights & Ratios
PEG Ratio2.86
Price to Book (P/B)1.09
Price to Sales (P/S)0.00
P/FCF Ratio17.79
Enterprise Value/Market Cap0.92
Enterprise Value/Revenue0.84
Enterprise Value/Gross Profit3.01
Enterprise Value/Ebitda6.63
Forecast
1Y Price Target
$37.25Price Target Upside25.76% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Orrstown Financial Services Business Overview & Revenue Model
Company DescriptionOrrstown Financial Services, Inc. (ORRF) is a financial holding company that operates primarily through its subsidiary, Orrstown Bank. The company provides a comprehensive range of commercial banking, retail banking, mortgage banking, wealth management, and financial advisory services. With a strong presence in its local markets, Orrstown Bank serves individuals, businesses, and governmental entities, focusing on personalized customer service and community involvement.
How the Company Makes MoneyOrrstown Financial Services makes money primarily through interest income generated from its lending activities, which include commercial, residential, and consumer loans. The company also earns revenue from various non-interest income sources such as fees and service charges related to deposit accounts, loan servicing fees, and wealth management and advisory services. Additionally, Orrstown Bank benefits from strategic partnerships and collaborations with financial technology firms to enhance its service offerings and customer reach. The company's earnings are influenced by factors such as interest rate fluctuations, economic conditions in its operating regions, and the effectiveness of its risk management practices.
Orrstown Financial Services Financial Statement Overview
Summary
Orrstown Financial Services has shown strong revenue growth and improved leverage management. However, declining net profit margins and inconsistent cash flow generation pose risks, highlighting the need to enhance profitability and stabilize cash flows.Income Statement
Orrstown Financial Services shows strong revenue growth over the years, with an increase from $97.8 million in 2019 to $176.1 million in 2024. The gross profit margin remained consistently high, indicating efficient operations. However, the net profit margin has declined from 22% in 2019 to 12.5% in 2024, suggesting increased expenses or lower profit efficiency. EBIT and EBITDA margins indicate good operational earnings, but the decline in net income should be monitored.75
Positive
Balance Sheet
The company's debt-to-equity ratio decreased significantly from 1.12 in 2019 to 0.36 in 2024, showing improved leverage management and financial stability. The equity ratio has improved from 9.36% in 2019 to 9.51% in 2024, reflecting a stable capital structure. Return on Equity decreased from 7.58% in 2019 to 4.27% in 2024, indicating reduced profitability relative to shareholder equity.70
Positive
Cash Flow
Free cash flow has grown from $6.2 million in 2019 to $0 in 2024, reflecting challenges in maintaining positive cash flow. Operating cash flow has been volatile, with a notable decrease in 2024. The absence of reported operating cash flow in 2024 is concerning and should be addressed to ensure sustainability.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 176.14M | 149.90M | 1.29M | 116.13M | 111.92M | Gross Profit |
| 176.14M | 143.79M | -4.67M | 110.11M | 105.26M | EBIT |
| 76.97M | 141.64M | 39.16M | 40.90M | 32.51M | EBITDA |
| 0.00 | 0.00 | 100.44M | 85.50M | 39.08M | Net Income Common Stockholders |
| 22.05M | 35.66M | 22.04M | 32.88M | 26.46M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 238.31M | 546.11M | 574.55M | 681.15M | 591.72M | Total Assets |
| 5.44B | 3.06B | 2.92B | 2.83B | 2.75B | Total Debt |
| 184.04M | 169.59M | 138.16M | 33.86M | 89.95M | Net Debt |
| -54.26M | 104.43M | 77.34M | -174.85M | -35.31M | Total Liabilities |
| 4.92B | 2.80B | 2.69B | 2.56B | 2.50B | Stockholders Equity |
| 516.68M | 265.06M | 228.90M | 271.66M | 246.25M |
| Cash Flow | Free Cash Flow | |||
| 33.38M | 41.41M | 35.30M | 39.56M | 28.87M | Operating Cash Flow |
| 34.96M | 43.70M | 36.19M | 40.81M | 30.17M | Investing Cash Flow |
| 60.99M | -153.25M | -270.99M | -2.01M | -292.35M | Financing Cash Flow |
| 87.76M | 113.89M | 86.91M | 44.65M | 331.47M |
Orrstown Financial Services Technical Analysis
Negative
29.62
Price Trends
29.18
Positive
31.51
Negative
33.75
Negative
Market Momentum
0.36
Positive
46.51
Neutral
7.81
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ORRF, the sentiment is Negative. The current price of 29.62 is below the 20-day moving average (MA) of 30.26, above the 50-day MA of 29.18, and below the 200-day MA of 33.75, indicating a neutral trend. The MACD of 0.36 indicates Positive momentum. The RSI at 46.51 is Neutral, neither overbought nor oversold. The STOCH value of 7.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $564.72M | 11.61 | 12.00% | 1.67% | 8.76% | -18.66% | |
68 Neutral | $577.84M | 15.10 | 7.85% | 3.11% | 75.72% | -41.36% | |
66 Neutral | $556.82M | 13.26 | 6.12% | 5.75% | 5.10% | -24.91% | |
65 Neutral | $535.77M | 18.99 | 6.68% | 1.01% | 7.69% | 13.82% | |
65 Neutral | $600.59M | 10.95 | 10.02% | 3.76% | 16.84% | -1.03% | |
64 Neutral | $12.64B | 9.78 | 7.67% | 17015.08% | 12.23% | -6.02% | |
58 Neutral | $535.33M | 12.16 | -5.43% | 8.01% | -18.44% | -157.94% |
* Financial Sector Average
Performance Comparison
ORRF
Orrstown Financial Services
29.62
4.04
15.79%
THFF
First Financial Indiana
50.68
15.18
42.76%
HTBK
Heritage Commerce
9.04
1.31
16.95%
HIFS
Hingham Institution For Savings
245.74
76.84
45.49%
WASH
Washington Bancorp
27.75
3.58
14.81%
SPFI
South Plains Financial
34.80
8.86
34.16%
Orrstown Financial Services Earnings Call Summary
Earnings Call Date:Apr 22, 2025
(Q1-2025)
| % Change Since: 8.22%|
Next Earnings Date:Jul 29, 2025
Earnings Call Sentiment Neutral
Orrstown Financial Services showed strong core earnings and improved loan pipelines despite economic uncertainty and market volatility. While they faced challenges from the recent merger-related costs and a decrease in loan portfolios, they have managed to maintain a stable net interest margin and increase capital ratios.Q1-2025 Updates
Positive Updates
Strong Core Earnings Performance
Excluding merger and non-recurring charges, the return on average assets was 1.45% and return on average equity was 14.97% for Q1 2025, compared to 1.19% and 13.79% in Q4 2024.
Improved Loan Pipeline
Loan pipelines have increased by over 40% since year-end, indicating positive momentum despite economic challenges.
Stable and Decreasing Funding Costs
Net interest margin remains strong at 4% for Q1 2025. The cost of deposits declined 15 basis points from Q4 2024 to Q1 2025.
Capital Growth
Capital ratios increased across the board quarter-to-quarter, with TCE nearing 8%.
Negative Updates
Economic Uncertainty and Market Volatility
Recent political actions have introduced market volatility and uncertainty into the national economy, impacting borrower expansion plans.
Loan Portfolio Reduction
Total loans decreased by $55 million from December 31, 2024, mainly due to a proactive decision to manage risk and higher-than-expected loan payoffs.
Merger and Integration Costs
Operating results continue to be impacted by merger-related expenses, which are expected to normalize in the second quarter.
Company Guidance
During the Orrstown Financial Services Inc. First Quarter 2025 Earnings Conference Call, guidance was provided on several key financial metrics and strategic initiatives. Tom Quinn, the CEO, highlighted core earnings performance, with return on average assets at 1.45% and return on average equity at 14.97% for the quarter ending March 31, 2025. Despite merger-related expenses impacting results, the company expects these costs to normalize by the second quarter, reducing non-interest expenses by approximately $1 million. The net interest margin remained strong at 4%, with a decrease in the cost of deposits by 15 basis points from the previous quarter. The company saw a 1.4% decline in loans due to strategic risk management actions, but anticipates mid-single-digit loan growth moving forward. Adam Metz noted a 40% increase in loan pipelines since year-end, reflecting positive momentum despite economic uncertainties. The company's CRE concentration was at 302% of risk-based capital, below their internal limit of 350%. Capital ratios improved, with the TCE ratio nearing 8%, and the company is considering strategic opportunities such as buybacks and sub-debt redemption to enhance shareholder value.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.