TowneBank (TOWN) AI Stock Analysis

• Market Cap: $2.85B
• Dividend Yield: 3.04%
• Average Volume (3M): 311.39K
• Price to Earnings (P/E): 15.5
• Beta (1Y): 0.84
• Revenue Growth: 9.48%
• EPS Growth: 12.83%
• Country: US
• Employees: 2,704
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.83
• Shares Outstanding: 81,057,180
• 10 Day Avg. Volume: 360,092
• 30 Day Avg. Volume: 311,389
• PEG Ratio: 3.25
• Price to Book (P/B): 1.19
• Price to Sales (P/S): 2.49
• P/FCF Ratio: 31.47
• Enterprise Value/Market Cap: 0.97
• Enterprise Value/Revenue: 2.57
• Enterprise Value/Gross Profit: 3.63
• Enterprise Value/Ebitda: 11.49
• 1Y Price Target: $41.00
• Price Target Upside: 16.61% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: $37.00 ▲(5.23% Upside)

TowneBank's overall stock score is driven by its solid financial performance and stable valuation metrics. The technical analysis presents mixed signals, with short-term bullish momentum but potential resistance in the medium to long term. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates TowneBank's ability to expand its market presence and enhance its product offerings, supporting long-term financial stability.

Cash Generation

Strong cash generation capabilities enhance TowneBank's ability to invest in growth opportunities and maintain financial flexibility, supporting sustainable operations.

Strategic Partnerships

Strategic partnerships and acquisitions expand TowneBank's market reach and service offerings, driving long-term growth and competitive advantage.

Negative Factors

Credit Loss Provisions

Increased credit loss provisions may indicate potential asset quality issues, which could pressure profitability and financial health over time.

Profit Margin Pressure

Decreasing net profit margins suggest rising costs or competitive pressures, potentially impacting TowneBank's profitability and operational efficiency.

Operating Cash Flow

Challenges in converting income into cash could limit TowneBank's ability to fund operations and growth initiatives, affecting long-term financial stability.

TowneBank Business Overview & Revenue Model

Company Description

TowneBank provides retail and commercial banking services for individuals, commercial enterprises, and professionals. The company operates through three segments: Banking, Realty, and Insurance. It accepts various deposits, including demand deposits, savings accounts, money rate savings, certificates of deposit, and individual retirement accounts. The company also offers secured and unsecured personal loans for financing automobiles, home improvements, education, and personal investments; commercial loans for working capital, business expansion, and equipment and machinery purchases; and mortgage loans, as well as real estate acquisition, development, and construction loans. In addition, it provides other services, such as safe deposit boxes, treasury management services, direct deposit of payroll and social security checks, and automatic drafts for various accounts, as well as online, mobile, and on-call banking services. Further, the company offers documentation services to accomplish tax deferral to investors; investment and asset management services; commercial mortgage brokerage services; and other financial services, such as financial, retirement, and estate planning services, as well as assistance on various investment options comprising alternative investments, annuities, margin accounts, convertible bonds, and pension and profit-sharing plans. Additionally, it provides residential real estate, relocation, property management, vacations rental, and title and settlement services; and originates residential mortgage loans. The company also offers life, property, casualty, and vehicle insurance services; and employee benefit programs, such as health, dental, vision, and disability insurance. It operates in Richmond, Virginia, the Greater Hampton Roads region in southeastern Virginia, northeastern North Carolina, Raleigh, Charlotte, Greensboro, and Greenville, North Carolina. TowneBank was incorporated in 1998 and is headquartered in Portsmouth, Virginia.

How the Company Makes Money

TowneBank generates revenue primarily through interest income from loans and investments, as well as non-interest income from service fees and commissions. The key revenue streams include interest from commercial and residential loans, which are a significant portion of the bank's portfolio, and fees associated with deposit accounts and other banking services. Additionally, TowneBank earns income from its wealth management services, which involve investment advisory and trust services for clients. The bank may also benefit from strategic partnerships with local businesses and organizations that enhance its service offerings and customer base, contributing to overall earnings.

TowneBank Financial Statement Overview

Summary

TowneBank demonstrates strong revenue growth and efficient cost management, reflected in solid margins. The balance sheet is healthy with low leverage and stable returns on equity. However, cash flow challenges, particularly in free cash flow growth, could pose risks if not addressed.

Income Statement

TowneBank's income statement shows a solid performance with a consistent revenue growth rate of 2.05% in the TTM. The gross profit margin is strong at 82.11%, indicating efficient cost management. However, the net profit margin has decreased from previous years, now at 19.25%, suggesting some pressure on profitability. The EBIT and EBITDA margins remain healthy, reflecting good operational efficiency.

Balance Sheet

The balance sheet is robust with a low debt-to-equity ratio of 0.13, indicating conservative leverage. The return on equity is stable at 7.89%, showing consistent profitability relative to equity. The equity ratio is strong, suggesting a solid capital structure with a high proportion of equity financing.

Cash Flow

Cash flow analysis reveals challenges with a significant decline in free cash flow growth, down by 38.25% in the TTM. The operating cash flow to net income ratio is low, indicating potential issues in converting income into cash. However, the free cash flow to net income ratio remains reasonable, suggesting some level of cash generation efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.08B	1.02B	942.55M	742.95M	720.08M	742.25M
Gross Profit	765.36M	692.51M	676.41M	677.77M	695.77M	595.06M
EBITDA	241.52M	225.55M	220.44M	265.75M	308.63M	230.39M
Net Income	169.67M	161.76M	153.72M	188.99M	215.38M	145.53M
Balance Sheet
Total Assets	19.68B	17.25B	16.84B	15.85B	16.36B	14.63B
Cash, Cash Equivalents and Short-Term Investments	1.34B	1.40B	3.26B	2.99B	5.10B	3.23B
Total Debt	362.23M	296.90M	492.58M	318.01M	481.82M	772.88M
Total Liabilities	17.28B	15.09B	14.78B	13.96B	14.45B	12.84B
Stockholders Equity	2.40B	2.14B	2.04B	1.87B	1.90B	1.77B
Cash Flow
Free Cash Flow	198.55M	81.09M	117.17M	363.22M	487.62M	82.10M
Operating Cash Flow	242.29M	138.36M	161.30M	415.50M	518.82M	127.89M
Investing Cash Flow	-525.56M	-202.77M	-335.68M	-2.05B	-547.36M	-1.12B
Financing Cash Flow	237.19M	275.53M	149.90M	-512.10M	1.46B	2.41B

TowneBank Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 35.16
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TOWN, the sentiment is Positive. The current price of 35.16 is above the 20-day moving average (MA) of 34.42, above the 50-day MA of 33.52, and above the 200-day MA of 33.79, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 62.39 is Neutral, neither overbought nor oversold. The STOCH value of 80.65 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TOWN.

TowneBank Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WSBC	78 Outperform	$3.35B	17.49	5.25%	4.35%	41.49%	-5.53%
BKU	74 Outperform	$3.43B	12.83	9.04%	2.71%	-5.44%	45.47%
CVBF	72 Outperform	$2.65B	13.14	9.10%	4.00%	-8.43%	3.75%
FBK	71 Outperform	$3.15B	27.12	5.85%	1.34%	10.50%	-6.22%
TOWN	70 Outperform	$2.85B	15.48	7.37%	3.04%	9.48%	12.83%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
SFNC	61 Neutral	$2.79B	-6.65	-12.42%	4.41%	-55.53%	-387.04%