Orrstown Financial Services Inc (ORRF)
NASDAQ:ORRF
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Orrstown Financial Services
(NASDAQ:ORRF)
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Rating:67Neutral
Price Target:
$37.00
â–¼(-2.73% Downside)
Action:DowngradedDate:03/13/26
The score is driven primarily by improved profitability and generally solid balance sheet positioning, offset by weak cash-flow quality. Valuation is a clear positive (low P/E and ~3.2% yield), while technicals are currently bearish (negative MACD, weak RSI/Stoch and price below key moving averages). The latest earnings call supports the fundamental outlook with conservative guidance and strong recent results, but flags meaningful rate- and funding-related sensitivities.
Positive Factors
Fee Income Diversification
Fee income representing roughly one-fifth of operating income indicates durable revenue diversification beyond net interest margin. Stable wealth, treasury and merchant services fees smooth earnings through rate cycles, support cross-sell economics, and provide predictable recurring revenue to fund growth investments.
Negative Factors
Weak Cash Conversion
A sharp decline in free cash flow and a collapse in cash-to-earnings indicate weaker cash conversion of reported profits. Over months this limits capacity to self-fund dividend growth, buybacks or investment, increases sensitivity to working capital shifts, and raises reliance on external funding.
Read all positive and negative factors
Positive Factors
Negative Factors
Fee Income Diversification
Fee income representing roughly one-fifth of operating income indicates durable revenue diversification beyond net interest margin. Stable wealth, treasury and merchant services fees smooth earnings through rate cycles, support cross-sell economics, and provide predictable recurring revenue to fund growth investments.
Read all positive factors
Orrstown Financial Services (ORRF) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$746.34M
Dividend Yield2.93%
Average Volume (3M)198.51K
Price to Earnings (P/E)7.3
Beta (1Y)0.83
Revenue Growth47.65%
EPS Growth101.00%
CountryUS
Employees607
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)1.11
Shares Outstanding19,619,799
10 Day Avg. Volume140,005
30 Day Avg. Volume198,512
Financial Highlights & Ratios
PEG Ratio0.04
Price to Book (P/B)1.00
Price to Sales (P/S)1.67
P/FCF Ratio8.36
Enterprise Value/Market Cap1.39
Enterprise Value/Revenue2.94
Enterprise Value/Gross Profit4.16
Enterprise Value/Ebitda8.92
Forecast
1Y Price Target
$42.50Price Target Upside11.72% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)4.22
Revenue Forecast (FY)$260.60M
Orrstown Financial Services Business Overview & Revenue Model
Company Description
Orrstown Financial Services, Inc. operates as the holding company for Orrstown Bank that provides commercial banking and trust services in the United States. The company accepts various deposits, including checking, savings, time, demand, and mone...
How the Company Makes Money
Orrstown Financial Services primarily makes money through its banking subsidiary by (1) earning net interest income and (2) generating noninterest income from fees and fiduciary-related services.
1) Net interest income (core revenue stream)
- Orr...
Orrstown Financial Services Earnings Call Summary
Earnings Call Date:Jan 27, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 28, 2026
Earnings Call Sentiment Positive
The call was broadly positive: management reported record annual and strong quarterly earnings, solid loan growth and fee-income expansion, improved capital metrics, low credit losses, and strategic repositioning of the investment portfolio. Headwinds include quarter-to-quarter NIM compression driven by lower variable loan yields and deposit pricing lag, slightly elevated operating expenses due to targeted talent investments, flat deposit balances, and localized credit stress that increased non-accruals. Management presented conservative but constructive guidance and emphasized optionality in capital deployment.Positive Updates
Record Annual Net Income
Reported highest annual net income in company history of $80.9 million, or $4.18 per diluted share; annual ROE 14.76% and ROA 1.49%.
Negative Updates
NIM Compression and Rate Sensitivity
Net interest margin declined from 4.11% in Q3 to 4.00% in Q4; margin excluding purchase accounting fell to 3.53% from 3.59% (down ~6 bps). Management attributes compression to lower variable loan yields after Fed cuts and lag in deposit rate reductions.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Annual Net Income
Reported highest annual net income in company history of $80.9 million, or $4.18 per diluted share; annual ROE 14.76% and ROA 1.49%.
Read all positive updates
Company Guidance
Management provided conservative 2026 guidance calling for a net interest margin of 3.90%–4.00% (Q4 core NIM ex‑purchase accounting 3.53%; core NIM expected to tick up in Q1), assuming roughly 75 bps of policy rate cuts in 2026 and purchase‑accounting accretion declining about 2–3 bps per quarter; they expect loan growth of 5%+ for 2026 after 4% Q4 growth and $207M of Q4 loan production, a quarterly noninterest income run‑rate of $13M–$14M (Q4 noninterest income $14.4M, 22% of revenue; annual fee income $52.3M = 21% of operating income), and a quarterly noninterest expense run‑rate around $37M (Q4 expense $37.4M). Additional metrics underpinning the outlook include Q4 deposit cost of 1.98% with funding costs expected to decline beginning in Q1, a loan‑to‑deposit ratio of 89%, allowance for loan losses of 1.19% of loans (Q4 provision ~$75k; Q4 net charge‑offs $0.5M), investment portfolio yield ~4.58% (recent purchases averaging 4.92%), and improving capital (TCE ~9%); management emphasized the plan is conservative and could exceed current analyst consensus.Orrstown Financial Services Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
71
Positive
Cash Flow
46
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 353.86M | 284.09M | 174.30M | 134.32M | 121.64M |
| Gross Profit | 249.97M | 173.86M | 127.62M | 121.11M | 113.83M |
| EBITDA | 116.68M | 37.50M | 49.37M | 31.24M | 46.20M |
| Net Income | 80.86M | 22.05M | 35.66M | 22.04M | 32.88M |
Balance Sheet | |||||
| Total Assets | 5.54B | 5.44B | 3.06B | 2.92B | 2.83B |
| Cash, Cash Equivalents and Short-Term Investments | 994.82M | 1.08B | 578.68M | 574.55M | 681.15M |
| Total Debt | 336.37M | 209.91M | 179.38M | 155.42M | 57.16M |
| Total Liabilities | 4.95B | 4.92B | 2.80B | 2.69B | 2.56B |
| Stockholders Equity | 591.53M | 516.68M | 265.06M | 228.90M | 271.66M |
Cash Flow | |||||
| Free Cash Flow | 70.50M | 33.38M | 41.41M | 35.30M | 39.56M |
| Operating Cash Flow | 74.73M | 34.96M | 43.70M | 36.19M | 40.81M |
| Investing Cash Flow | -181.96M | 60.99M | -153.25M | -270.99M | -2.01M |
| Financing Cash Flow | 8.13M | 87.76M | 113.89M | 86.91M | 44.65M |
Orrstown Financial Services Technical Analysis
Positive
38.04
Price Trends
36.28
Positive
36.04
Positive
34.59
Positive
Market Momentum
0.33
Negative
69.99
Neutral
93.92
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 38.04 is above the 20-day moving average (MA) of 35.39, above the 50-day MA of 36.28, and above the 200-day MA of 34.59, indicating a bullish trend. The MACD of 0.33 indicates Negative momentum. The RSI at 69.99 is Neutral, neither overbought nor oversold. The STOCH value of 93.92 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 |
|---|---|---|---|---|---|---|---|
76 Outperform | $859.32M | 10.76 | 14.49% | 2.18% | 22.24% | 18.63% | |
69 Neutral | $851.51M | 8.09 | 9.49% | 3.66% | 24.08% | 9.83% | |
69 Neutral | $789.86M | 8.35 | 13.02% | 3.19% | 16.57% | 69.64% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
67 Neutral | $746.34M | 7.29 | 14.41% | 2.93% | 47.65% | 101.00% | |
66 Neutral | $943.74M | 26.28 | 6.55% | 0.67% | 14.04% | 337.54% | |
62 Neutral | $734.86M | 9.89 | 11.33% | 2.48% | 0.67% | 17.88% |
* Financial Sector Average
ORRF
Orrstown Financial Services
38.04
11.61
43.93%
CAC
Camden National
50.31
13.48
36.60%
THFF
First Financial Indiana
66.42
22.84
52.42%
GSBC
Great Southern Bancorp
67.03
15.07
29.00%
FSBC
Five Star
40.20
14.54
56.69%
NBBK
NB Bancorp, Inc.
22.19
5.76
35.02%
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.