Sound Financial Bancorp (SFBC) AI Stock Analysis

• Market Cap: $109.60M
• Dividend Yield: 1.75%
• Average Volume (3M): 4.73K
• Price to Earnings (P/E): 15.4
• Beta (1Y): 0.17
• Revenue Growth: 2.85%
• EPS Growth: 73.41%
• Country: US
• Employees: 108
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.87
• Shares Outstanding: 2,566,069
• 10 Day Avg. Volume: 4,244
• 30 Day Avg. Volume: 4,734
• PEG Ratio: -0.77
• Price to Book (P/B): 1.29
• Price to Sales (P/S): 2.16
• P/FCF Ratio: 46.88
• Enterprise Value/Market Cap: -0.03
• Enterprise Value/Revenue: -0.06
• Enterprise Value/Gross Profit: -0.09
• Enterprise Value/Ebitda: -0.36
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: $47.00 ▲(6.84% Upside)
• Action: Reiterated Date: 01/31/26
• Date: Action: Reiterated 01/31/26

The score is driven primarily by improving profitability, solid cash conversion, and lower leverage, which support a stable fundamentals profile. This is tempered by the very weak reported TTM revenue growth and only neutral-to-soft technical positioning, while valuation and the positive corporate update (including a dividend raise) provide moderate support.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a stable demand for the company's financial products and services, supporting long-term business sustainability.

Cash Flow Generation

Strong cash flow generation enhances the company's ability to invest in growth opportunities, pay down debt, and return capital to shareholders.

Balance Sheet Health

A low debt-to-equity ratio suggests financial stability and flexibility, allowing the company to withstand economic fluctuations and invest in growth.

Negative Factors

Net Profit Margin Decline

Declining net profit margins may indicate rising costs or inefficiencies, which could pressure future profitability if not addressed.

Profitability Margin Concerns

Sustaining profitability margins is crucial for long-term financial health, as shrinking margins can limit reinvestment and shareholder returns.

Free Cash Flow Conversion

A free cash flow to net income ratio below 1 suggests not all earnings are converting to cash, potentially impacting liquidity and investment capacity.

Sound Financial Bancorp Business Overview & Revenue Model

Company Description

Sound Financial Bancorp, Inc. operates as the bank holding company for Sound Community Bank that provides banking and other financial services for consumers and businesses. It accepts various deposits products comprising savings, money market deposit, NOW, and demand accounts, as well as certificates of deposit. The company also offers loans secured by first and second mortgages on one-to four-family residences; home equity loans, including fixed-rate loans and variable-rate lines of credit; commercial and multifamily real estate loans; construction loans secured by single-family residences, and commercial and multifamily real estate; land loans; commercial business loans to finance commercial vehicles and equipment, as well as loans secured by accounts receivable and/or inventory; and secured and unsecured consumer loans, such as new and used manufactured homes, floating homes, automobiles, boats, and recreational vehicle loans, and loans secured by deposit accounts. It operates eight branch offices, including four branches in Seattle Metropolitan Statistical Area, three branches in Clallam County, and one branch in Jefferson County; and a loan production office in the Madison Park neighborhood of Seattle. The company was founded in 1953 and is headquartered in Seattle, Washington.

How the Company Makes Money

Sound Financial Bancorp generates revenue primarily through interest income from its loan portfolio, which includes residential mortgages, commercial loans, and consumer loans. The company also earns revenue from fees associated with deposit accounts and various banking services. Additionally, SFBC may generate income from investment securities and other financial products. Key revenue streams include net interest income, which is the difference between interest earned on loans and interest paid on deposits, as well as non-interest income from service fees and commissions. Partnerships with local businesses and community organizations enhance customer acquisition and retention, contributing to its overall earnings.

Sound Financial Bancorp Financial Statement Overview

Summary

Profitability improved in the TTM period (net income up to $6.8M and net margin expanding to ~15.2%), supported by positive operating/free cash flow (~$5.3M) with strong cash conversion (FCF to net income ~1.0) and reduced leverage (debt-to-equity ~0.03). Offsetting these positives, the reported TTM revenue growth of -87.2% is a major concern (whether business pressure or data irregularity) and cash flow has been historically volatile.

Income Statement

TTM (Trailing-Twelve-Months) profitability improved versus 2024, with net income rising to $6.8M from $4.6M and net margin expanding to ~15.2% from ~7.5%, indicating better earnings efficiency. However, the TTM revenue growth rate is sharply negative (-87.2%), which is a major red flag and suggests a likely data anomaly or severe revenue compression; either way, it weakens confidence in the top-line trajectory. Longer-term, revenue grew from 2021–2024 and profits were stronger in 2021–2023, but margins have been more volatile and generally below the 2021–2022 peak.

Balance Sheet

Leverage appears manageable with equity of ~$107.5M on ~$1.06B of assets in TTM (Trailing-Twelve-Months). Debt metrics show improvement, with debt-to-equity reported very low in TTM (~0.03) versus ~0.39 in 2024 and higher levels in 2022–2023, implying balance-sheet de-risking. Returns on equity are moderate (TTM ~6.7%), improving from 2024 (~4.5%) but below the stronger 2020–2022 period (~9–10%), suggesting profitability is not yet back to prior levels.

Cash Flow

Cash generation is positive in TTM (Trailing-Twelve-Months), with operating cash flow of ~$5.3M and free cash flow of ~$5.3M, and free cash flow closely matching net income (free cash flow to net income ~1.0), which supports earnings quality. Free cash flow growth is strong in TTM (+13.4%) after a weak 2024. Offsetting this, cash flow has been choppy historically (including negative operating/free cash flow in 2020), and the operating cash flow coverage ratio is inconsistent across years (notably extremely low in 2023–2024), which raises questions about volatility and reliability of cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	62.27M	62.06M	55.60M	44.38M	41.22M	42.38M
Gross Profit	38.71M	35.69M	39.12M	38.72M	36.84M	34.00M
EBITDA	9.91M	7.22M	10.65M	12.47M	13.02M	13.15M
Net Income	6.83M	4.64M	7.44M	8.80M	9.16M	8.94M
Balance Sheet
Total Assets	1.06B	993.63M	995.22M	976.35M	919.69M	861.40M
Cash, Cash Equivalents and Short-Term Investments	103.41M	51.43M	57.98M	68.04M	192.01M	204.05M
Total Debt	40.73M	40.77M	56.54M	60.12M	17.88M	18.73M
Total Liabilities	952.71M	889.97M	894.57M	878.65M	826.33M	775.92M
Stockholders Equity	107.45M	103.67M	100.65M	97.70M	93.36M	85.48M
Cash Flow
Free Cash Flow	5.28M	2.86M	6.44M	9.66M	18.85M	-891.00K
Operating Cash Flow	5.31M	2.93M	6.89M	10.05M	19.07M	-484.00K
Investing Cash Flow	-5.59M	-3.94M	-26.32M	-183.79M	-78.11M	4.50M
Financing Cash Flow	-47.50M	-5.04M	11.29M	47.98M	48.80M	134.05M

Sound Financial Bancorp Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 43.99
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SFBC, the sentiment is Negative. The current price of 43.99 is above the 20-day moving average (MA) of 43.70, above the 50-day MA of 43.70, and below the 200-day MA of 45.54, indicating a bearish trend. The MACD of -0.21 indicates Positive momentum. The RSI at 36.03 is Neutral, neither overbought nor oversold. The STOCH value of 17.24 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SFBC.

Sound Financial Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SBFG	75 Outperform	$131.07M	9.50	10.12%	2.69%	10.78%	21.72%
UNB	74 Outperform	$110.53M	9.93	15.11%	6.08%	14.52%	27.90%
SRBK	68 Neutral	$127.33M	46.37	1.57%	0.88%	9.43%	166.36%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
SFBC	64 Neutral	$109.60M	15.42	6.52%	1.75%	2.85%	73.41%
AFBI	64 Neutral	$121.63M	15.47	5.95%	―	5.18%	36.12%
BSBK	48 Neutral	$109.59M	50.88	0.35%	―	-15.09%	―

Sound Financial Bancorp Corporate Events

Sound Financial Bancorp Posts Strong Q4 Results, Raises Dividend

On January 27, 2026, Sound Financial Bancorp reported improved fourth-quarter 2025 results, with net income rising to $2.2 million, or $0.87 per diluted share, up from $1.7 million in the prior quarter and $1.9 million a year earlier, driven largely by tight expense control and balance sheet optimization. Total assets grew 3.0% sequentially and 9.9% year over year to $1.09 billion, deposits rose 5.6% from the prior quarter and 13.3% from year-end 2024, and the loans-to-deposits ratio declined to 96%, reflecting stronger liquidity, even as loans held-for-portfolio were essentially flat. Net interest income dipped 3.1% from the third quarter but remained 5.4% above the prior-year level, while the net interest margin compressed sequentially to 3.36% but improved from 3.13% a year earlier. Noninterest income weakened and nonperforming loans more than doubled from the prior quarter to $5.8 million, though management emphasized these were well-secured credits and overall credit quality remained stable, with the allowance for credit losses at 0.95% of loans and coverage of nonperforming loans near 149%. Noninterest expense fell 10.9% from the third quarter and 3.1% year over year, underscoring operational efficiencies, and the bank ended 2025 with capital levels above regulatory requirements and a “well-capitalized” designation. The board also declared a cash dividend of $0.21 per share, payable on February 23, 2026 to shareholders of record on February 9, 2026, signaling confidence in earnings strength, balance sheet flexibility, and the institution’s capacity to fund an emerging commercial loan pipeline despite a sluggish mortgage market.

The most recent analyst rating on (SFBC) stock is a Hold with a $48.00 price target. To see the full list of analyst forecasts on Sound Financial Bancorp stock, see the SFBC Stock Forecast page.