Old Second Bancorp (OSBC) AI Stock Analysis

• Market Cap: $920.86M
• Dividend Yield: 1.37%
• Average Volume (3M): 204.79K
• Price to Earnings (P/E): 9.6
• Beta (1Y): 0.82
• Revenue Growth: 2.02%
• EPS Growth: -2.80%
• Country: US
• Employees: 877
• Sector: Financial
• Sector Strength: 72
• Industry: Banks - Regional
• EPS (TTM): 0.48
• Shares Outstanding: 52,650,414
• 10 Day Avg. Volume: 154,335
• 30 Day Avg. Volume: 204,789
• 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: 0.96
• Enterprise Value/Revenue: 2.69
• Enterprise Value/Gross Profit: 4.30
• Enterprise Value/Ebitda: 7.44
• 1Y Price Target: $21.63
• Price Target Upside: 22.97% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 81 Outperform
• Price Target: $20.50 ▲(16.54% Upside)

Old Second Bancorp's overall stock score is driven by its strong financial performance and attractive valuation. The successful merger with Bancorp Financial and positive earnings call further bolster the outlook. Technical indicators suggest a neutral trend, with potential for growth given the company's strategic initiatives and financial health.

Positive Factors

Asset Quality

OSBC has successfully reduced non-performing assets by nearly 30% and narrowed net charge-offs since peak levels.

Net Interest Margin

OSBC's current NIM of 4.63% is over 100bp above small and mid cap peers, so despite greater than previously assumed NIM headwinds, margin at OSBC is still a relative strength.

Profitability Metrics

The bank's conservative credit approach, superior deposit franchise and above peer profitability metrics remain intact.

Negative Factors

Asset Sensitivity

Downgrading shares of OSBC to NEUTRAL, predominantly based on the bank's less favorable asset sensitive balance sheet position.

Credit Environment

Credit progress and deposit strength catalysts are likely to be overlooked or minimized should the market's attention turn to 'risk-on' credit names and/or banks with a greater ability to lower deposit costs.

Earnings Outlook

Lowering earnings outlook for OSBC to reflect added NIM pressure tied to the Fed's more aggressive rate cut path.

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 well as certificate of deposit accounts. The company also offers commercial loans; lease financing receivables; commercial real estate loans; construction loans; residential real estate loans, such as residential first mortgage and second mortgage loans; home equity line of credit; consumer loans, including motor vehicle, home improvement, and signature loans; installment and agricultural loans; residential mortgages; and overdraft checking. Further, it provides safe deposit services; trust and wealth management services; and money orders, cashier's checks, foreign currency, direct deposits, discount brokerage, debit and credit cards, and other services, as well as acquires the U.S. treasury notes and bonds. In addition, the company offers online and mobile banking; corporate cash management products, including remote and mobile deposits capture, investment sweep accounts, zero balance accounts, automated tax payments, automatic teller machines access, telephone banking, lockbox accounts, automated clearing house transactions, account reconciliation, controlled disbursement, detail and general information reporting, foreign and domestic wire transfers, and vault services for currency and coin; and investment, agency, and custodial services for individual, corporate, and not-for-profit clients. It operates through 63 banking centers in Cook, DeKalb, DuPage, Kane, Kendall, LaSalle, and Will counties in Illinois. Old Second Bancorp, Inc. was incorporated in 1981 and is headquartered in Aurora, Illinois.

How the Company Makes Money

Old Second Bancorp generates revenue primarily through interest income from loans and investment securities. The company earns interest by lending to consumers and businesses, with various loan products including commercial loans, residential mortgages, and consumer loans. Additionally, OSBC earns non-interest income from fees associated with deposit accounts, wealth management services, and other financial products. Significant partnerships with local businesses and community organizations enhance its client base and drive customer loyalty, contributing to its overall earnings. Furthermore, the bank's focus on maintaining a strong loan-to-deposit ratio allows it to effectively manage its funding and capitalize on interest rate spreads.

Old Second Bancorp Financial Statement Overview

Summary

Old Second Bancorp maintains a strong financial foundation characterized by high profitability, effective leverage management, and consistent cash flow generation. Despite some fluctuations in revenue growth, the company's margins and returns remain robust, underpinned by strategic cost controls and efficient capital utilization. Potential risks include revenue volatility and decreasing cash reserves, which need careful oversight.

Income Statement

Old Second Bancorp demonstrates strong profitability with a consistent increase in net income over the years. The TTM data shows a healthy gross profit margin of approximately 89.8% and net profit margin of 27.0%, indicating efficient cost management. However, revenue growth has been somewhat volatile, with a recent dip compared to previous periods, which may be a concern if the trend continues.

Balance Sheet

The company's financial position is stable with a strong equity base as evidenced by a solid equity ratio of approximately 12.1% in TTM. The debt-to-equity ratio is low at 0.18, suggesting prudent leverage management. Return on equity is impressive at 12.1%, showcasing effective deployment of equity capital. However, the continual decrease in cash equivalents may require monitoring.

Cash Flow

Operating cash flow has remained robust, supporting a healthy operating cash flow to net income ratio of 1.21 in TTM. Although free cash flow has slightly declined, it remains positive, indicating good liquidity. The free cash flow to net income ratio of 1.11 in TTM implies strong cash generation relative to net profits.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	328.21M	336.17M	321.03M	255.24M	141.89M	139.51M
Gross Profit	205.22M	267.15M	264.49M	238.37M	129.11M	116.63M
EBITDA	118.63M	122.12M	131.35M	98.43M	31.66M	40.70M
Net Income	83.71M	85.26M	91.73M	67.41M	20.04M	27.82M
Balance Sheet
Total Assets	5.70B	5.65B	5.72B	5.89B	6.21B	3.04B
Cash, Cash Equivalents and Short-Term Investments	1.24B	1.26B	1.29B	1.65B	2.45B	826.08M
Total Debt	132.54M	141.90M	516.63M	260.81M	198.88M	160.52M
Total Liabilities	4.98B	4.98B	5.15B	5.43B	5.71B	2.73B
Stockholders Equity	718.65M	671.03M	577.28M	461.14M	502.03M	307.09M
Cash Flow
Free Cash Flow	110.08M	120.75M	104.03M	93.01M	29.01M	22.07M
Operating Cash Flow	114.58M	131.53M	116.40M	97.34M	31.05M	25.99M
Investing Cash Flow	238.46M	322.70M	161.56M	-432.78M	132.92M	-103.81M
Financing Cash Flow	-332.16M	-455.05M	-292.99M	-301.50M	258.24M	357.09M

Old Second Bancorp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 17.59
• 50DMA: Negative
• 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 OSBC, the sentiment is Positive. The current price of 17.59 is above the 20-day moving average (MA) of 17.29, below the 50-day MA of 17.67, and above the 200-day MA of 17.35, indicating a neutral trend. The MACD of -0.06 indicates Negative momentum. The RSI at 51.06 is Neutral, neither overbought nor oversold. The STOCH value of 76.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OSBC.

Old Second Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OSBC	81 Outperform	$920.86M	9.55	12.51%	1.37%	2.02%	-2.80%
FCBC	80 Outperform	$662.63M	13.28	9.91%	9.23%	0.89%	-2.22%
NBN	79 Outperform	$814.36M	10.13	19.16%	0.04%	33.02%	33.76%
HBT	75 Outperform	$791.48M	10.37	14.08%	3.25%	4.86%	7.89%
MCBS	72 Outperform	$725.53M	11.05	15.67%	3.29%	4.92%	20.83%
CPF	72 Outperform	$770.59M	12.79	11.16%	3.71%	2.81%	6.88%
Sector *	58 Neutral	HK$110.85B	6.44	-5.15%	3.92%	9.01%	-47.48%

Old Second Bancorp Corporate Events

Old Second Bancorp Completes Merger with Bancorp Financial

On July 1, 2025, Old Second Bancorp completed its merger with Bancorp Financial, resulting in Evergreen Bank Group merging into Old Second National Bank. This merger expands Old Second’s assets, deposits, and loans, and strengthens its presence in the Chicago market. The merger also led to the appointment of Darin Campbell and Jill Voss to the boards of Old Second and its subsidiary bank, enhancing leadership and strategic direction.

Old Second Bancorp Merger Receives Stockholder Approval

On June 18, 2025, Bancorp Financial, Inc. received stockholder approval for its merger with Old Second Bancorp, Inc., a move initially announced on February 25, 2025. The merger is anticipated to finalize on July 1, 2025, pending the fulfillment of standard closing conditions, potentially impacting the company’s operations and market positioning.

Old Second Bancorp Doubles Authorized Common Stock Shares

On May 23, 2025, Old Second Bancorp, Inc. filed a Certificate of Amendment to increase its authorized common stock shares from 60,000,000 to 120,000,000. This amendment was approved by stockholders at the annual meeting on May 20, 2025, potentially impacting the company’s capital structure and shareholder value.

Old Second Bancorp Gains Approval for Merger

On May 22, 2025, Old Second Bancorp, Inc. announced it received regulatory approvals for its merger with Bancorp Financial, Inc., a significant step towards enhancing its financial strength and competitive position in the Chicago metropolitan market. The merger, expected to close in July 2025, aims to create a stronger institution that benefits stockholders and improves service capabilities, pending Bancorp Financial stockholder approval and other customary conditions.

Old Second Bancorp Holds Annual Stockholders Meeting

On May 20, 2025, Old Second Bancorp, Inc. held its Annual Meeting of Stockholders, where approximately 83.83% of the outstanding shares were represented. During the meeting, stockholders elected Edward Bonifas, Gary Collins, Keith Kotche, and Jill York as Class III directors for a term expiring in 2028, and voted on five additional proposals, including a non-binding advisory vote on executive compensation.

Old Second Bancorp Hosts Annual Stockholders Meeting

On May 20, 2025, Old Second Bancorp, Inc. held its Annual Stockholders Meeting, where a presentation was made available to shareholders and investors through the company’s website. This meeting is significant for stakeholders as it provides insights into the company’s operations and strategic direction.