Old Second Bancorp (OSBC)
NASDAQ:OSBC
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Old Second Bancorp
(NASDAQ:OSBC)
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Rating:68Neutral
Price Target:
$22.00
â–²(5.06% Upside)
Action:DowngradedDate:02/27/26
The score is driven primarily by solid financial performance (profitability and cash generation) and a constructive earnings outlook (NIM expected to remain >5% with improving capital), partially offset by weaker profitability trends (lower ROE, margin pressure) and credit/funding headwinds. Technical signals are neutral, while valuation is reasonable but not deeply compelling.
Positive Factors
Cash Generation Quality
Consistent operating cash flow (~$122M) and ~24% FCF growth in 2025, with free cash flow covering net income (~1.0x), indicate durable internal funding. Strong cash conversion supports reinvestment, capital returns and buffers for provisioning without heavy reliance on volatile external financing.
Negative Factors
Concentrated Credit Losses (Powersports)
Elevated, concentrated charge-offs driven by the Powersports portfolio create structural credit volatility following acquisition. Persistent losses require higher provisions, can erode underwriting economics, and may depress realized returns and capital generation if portfolio remediation spans multiple quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation Quality
Consistent operating cash flow (~$122M) and ~24% FCF growth in 2025, with free cash flow covering net income (~1.0x), indicate durable internal funding. Strong cash conversion supports reinvestment, capital returns and buffers for provisioning without heavy reliance on volatile external financing.
Read all positive factors
Old Second Bancorp (OSBC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.12B
Dividend Yield1.24%
Average Volume (3M)338.24K
Price to Earnings (P/E)8.9
Beta (1Y)0.76
Revenue Growth10.42%
EPS Growth-18.32%
CountryUS
Employees877
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)0.54
Shares Outstanding52,690,807
10 Day Avg. Volume310,798
30 Day Avg. Volume338,243
Financial Highlights & Ratios
PEG Ratio-0.93
Price to Book (P/B)1.15
Price to Sales (P/S)2.59
P/FCF Ratio8.72
Enterprise Value/Market Cap1.19
Enterprise Value/Revenue3.35
Enterprise Value/Gross Profit4.29
Enterprise Value/Ebitda11.02
Forecast
1Y Price Target
$23.38Price Target Upside11.65% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)2.19
Revenue Forecast (FY)$382.82M
Old Second Bancorp Business Overview & Revenue Model
Company Description
Old Second Bancorp, Inc. operates as the bank holding company for Old Second National Bank that provides community banking services. It provides demand, NOW, money market, savings, time deposit, individual retirement, and checking accounts, as wel...
How the Company Makes Money
Old Second Bancorp generates revenue primarily through interest income from loans and investments, as well as non-interest income from service charges and fees. Key revenue streams include interest earned from personal loans, commercial loans, and...
Old Second Bancorp Earnings Call Summary
Earnings Call Date:Jan 21, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 22, 2026
Earnings Call Sentiment Positive
The call emphasized strong profitability, margin expansion, capital improvement, completed integration and an improving loan origination pipeline — all material positives. The main negatives were elevated charge-offs concentrated in the newly acquired Powersports portfolio, modest sequential yield pressure, MSR volatility, and the need to replace acquisition-era wholesale deposits (~$300M–$400M). Management framed the Powersports losses as expected for the business given high contribution margins and remains optimistic about 2026. On balance, the positive operational and capital trends outweigh the quarter-specific credit and funding headwinds.Positive Updates
Strong Quarterly Profitability
GAAP net income of $28.8M ($0.54 diluted EPS) in Q4; adjusted net income excluding MSR loss and acquisition items of $30.8M ($0.58 EPS). Management noted EPS ~30% above prior year.
Negative Updates
Net Loan Charge-offs Concentrated in Powersports
Net loan charge-offs of $6.0M in Q4, with ~75% (~$4.5M) attributed to the Powersports portfolio. Management expects elevated gross charge-offs in Powersports versus historical levels in the near term.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Quarterly Profitability
GAAP net income of $28.8M ($0.54 diluted EPS) in Q4; adjusted net income excluding MSR loss and acquisition items of $30.8M ($0.58 EPS). Management noted EPS ~30% above prior year.
Read all positive updates
Company Guidance
Management's guidance called for mid‑single‑digit loan growth in 2026, modest expense growth (roughly a 3% run‑rate despite double‑digit employee‑benefit inflation), and an NIM that should remain above 5% (may tick modestly lower in 1Q but still >5%, with management expecting ~5% longer term into 2027); they will continue reducing reliance on wholesale funding by letting Evergreen broker CDs run off and targeting replacement of about $300–$400 million of deposits, expect acquisition costs to decline, plan to begin share repurchases soon, and see elevated near‑term net charge‑offs from the Powersports portfolio (Q4 NCOs $6.0M, ~75% Powersports; allowance $72.3M or 1.38% of loans; provisions down $3M QoQ ex day‑2). Key current metrics cited alongside guidance: Q4 tax‑equivalent NIM 5.09% (+4 bps q/q, +41 bps y/y), ROA 1.64%, ROTCE 16.15% (operating >17.5%), tangible book $14.12 (+61 bps), tangible equity 11.02% (+61 bps q/q), CET1 12.99% (12.44% prior qtr), cost of deposits 115 bps, L/D 93.9%, and adjusted efficiency ~51.28%.Old Second Bancorp Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
63
Positive
Cash Flow
78
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 396.97M | 336.17M | 321.03M | 255.24M | 141.89M |
| Gross Profit | 310.20M | 267.15M | 264.49M | 238.37M | 129.11M |
| EBITDA | 120.83M | 122.12M | 132.11M | 98.43M | 31.66M |
| Net Income | 80.31M | 85.26M | 91.73M | 67.41M | 20.04M |
Balance Sheet | |||||
| Total Assets | 6.90B | 5.65B | 5.72B | 5.89B | 6.21B |
| Cash, Cash Equivalents and Short-Term Investments | 196.38M | 1.26B | 1.29B | 1.65B | 2.45B |
| Total Debt | 338.92M | 141.90M | 516.63M | 260.81M | 198.88M |
| Total Liabilities | 6.01B | 4.98B | 5.15B | 5.43B | 5.71B |
| Stockholders Equity | 896.77M | 671.03M | 577.28M | 461.14M | 502.03M |
Cash Flow | |||||
| Free Cash Flow | 117.76M | 120.75M | 104.03M | 93.01M | 29.01M |
| Operating Cash Flow | 122.26M | 131.53M | 116.40M | 97.34M | 31.05M |
| Investing Cash Flow | 159.82M | 322.70M | 161.56M | -432.78M | 132.92M |
| Financing Cash Flow | -257.39M | -455.05M | -292.99M | -301.50M | 258.24M |
Old Second Bancorp Technical Analysis
Positive
20.94
Price Trends
20.05
Positive
19.83
Positive
18.79
Positive
Market Momentum
0.20
Negative
67.76
Neutral
95.10
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OSBC, the sentiment is Positive. The current price of 20.94 is above the 20-day moving average (MA) of 19.84, above the 50-day MA of 20.05, and above the 200-day MA of 18.79, indicating a bullish trend. The MACD of 0.20 indicates Negative momentum. The RSI at 67.76 is Neutral, neither overbought nor oversold. The STOCH value of 95.10 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OSBC.
Old Second Bancorp Risk Analysis
Old Second Bancorp disclosed 49 risk factors in its most recent earnings report. Old Second Bancorp 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
Old Second Bancorp Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $992.97M | 16.46 | 18.78% | 0.66% | 17.98% | 14.35% | |
73 Outperform | $1.03B | 10.37 | 9.82% | 2.59% | 4.49% | 20.44% | |
73 Outperform | $1.04B | 10.15 | 9.74% | 2.43% | 3.54% | 12.23% | |
68 Neutral | $1.12B | 8.92 | 10.11% | 1.24% | 10.42% | -18.32% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
67 Neutral | $1.21B | 6.42 | 11.20% | 3.39% | 9.55% | 27.32% | |
53 Neutral | $972.62M | 13.23 | 8.53% | 4.59% | -4.08% | -16.80% |
* Financial Sector Average
OSBC
Old Second Bancorp
21.19
5.99
39.44%
SBSI
Southside Bancshares
32.70
6.07
22.81%
TMP
Tompkins Financial Corporation
84.20
25.94
44.53%
UVSP
Univest Of Pennsylvania
36.82
10.58
40.31%
FMBH
First Mid-Illinois Bancshares
43.34
11.28
35.18%
ESQ
Esquire Financial Holdings
114.97
36.55
46.62%
Old Second Bancorp Corporate Events
Business Operations and StrategyStock Buyback
Old Second Bancorp Announces $43.9 Million Share Buyback
Positive
Jan 29, 2026
On January 27, 2026, Old Second Bancorp, Inc. reported that its Board of Directors had authorized a share repurchase program of up to $43.9 million of the company’s common stock, following a January 8, 2026 non-objection letter from the Fede...
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.