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Live Oak Bancshares
(NYSE:LOB)
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Rating:72Outperform
Price Target:
$48.00
â–²(14.07% Upside)
Action:Reiterated
Date:08/19/26
The score is driven primarily by improving profitability and a conservatively levered balance sheet, reinforced by a constructive uptrend in the stock and positive management commentary on growth, margins, and efficiency. The main constraint is weak and volatile TTM cash generation (negative operating/free cash flow), alongside credit/provision headwinds discussed on the earnings call.
Positive Factors
Loan growth and pipeline strength
Strong originations across 33 industries and a record pipeline support continued expansion of interest income, fee revenue and customer relationships, while industry specialization can help Live Oak maintain a differentiated small-business lending position.
Negative Factors
Weak recent cash generation
The latest TTM reversal to negative operating and free cash flow reduces earnings quality and financial flexibility. Although prior years produced positive cash, continued weakness could increase reliance on balance-sheet funding and make results more volatile.
Read all positive and negative factors
Positive Factors
Negative Factors
Loan growth and pipeline strength
Strong originations across 33 industries and a record pipeline support continued expansion of interest income, fee revenue and customer relationships, while industry specialization can help Live Oak maintain a differentiated small-business lending position.
Read all positive factors
Live Oak Bancshares Key Performance Indicators (KPIs)
Live Oak Bancshares (LOB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.89B
Dividend Yield0.29%
Average Volume (3M)309.55K
Price to Earnings (P/E)14.2
Beta (1Y)1.10
Revenue Growth7.11%
EPS Growth132.73%
CountryUS
Employees1,027
SectorGeneral
Sector StrengthN/A
IndustryBanks - Regional
Share Statistics
EPS (TTM)2.88
Shares Outstanding46,283,620
10 Day Avg. Volume399,602
30 Day Avg. Volume309,546
Financial Highlights & Ratios
PEG Ratio0.51
Price to Book (P/B)1.26
Price to Sales (P/S)1.51
P/FCF Ratio10.99
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$52.75Price Target Upside25.36% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)3.09
Revenue Forecast (FY)$641.40M
Live Oak Bancshares Business Overview & Revenue Model
Company Description
Live Oak Bancshares, Inc., established in 2008 and based in Wilmington, North Carolina, functions as the parent entity for Live Oak Banking Company. This financial institution delivers a comprehensive array of commercial banking solutions to indiv...
How the Company Makes Money
Live Oak Bancshares primarily makes money through its banking operations. The largest earnings driver is net interest income: the bank earns interest and fees on loans (including SBA 7(a) and other small business/commercial loans) and on its inves...
Live Oak Bancshares Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call emphasized sustained multi-quarter momentum: strong loan production and record pipelines, double-digit revenue growth, expanding NII and margins, improving operating leverage, rapid traction in Live Oak Express and business checking, and broad AI adoption. Credit-related headwinds were notable but largely contained — primarily an exited distillery portfolio and CECL-driven provisions tied to growth. Management framed provisions as a tradeoff for high-quality, high-growth origination and expects provision run-rates to normalize in the $20–$25 million range. Overall, operational and revenue positives materially outnumber the discrete credit and funding headwinds.Positive Updates
Earnings Per Share Growth
Reported EPS of $0.74 for the quarter (up 23% sequentially and 45% year-over-year); adjusted EPS of $0.77 (up 20% year-over-year).
Negative Updates
Elevated Provision Expense
Provision expense was $26 million in Q2, driven ~45% by growth (new loans), ~40% by an exited distillery portfolio, and ~15% by macro/other factors. Management notes CECL increases provisions for growth.
Read all updates
Q2-2026 Updates
Positive
Negative
Earnings Per Share Growth
Reported EPS of $0.74 for the quarter (up 23% sequentially and 45% year-over-year); adjusted EPS of $0.77 (up 20% year-over-year).
Read all positive updates
Company Guidance
Management guided that near‑term rates should remain flat and NIM is expected to stay generally stable in the mid‑3.30% range (Q2 NIM 3.33%, +6 bps q/q), with NII of $125M (+5% q/q, +15% y/y). They reaffirmed targets of sustainable 15% ROE and 15%+ annual EPS growth (Q2 adjusted EPS $0.77, +20% y/y), expect low‑ to‑mid single‑digit expense growth with average quarterly noninterest expense around $85M and an adjusted efficiency ratio near 54% (improved ~7 pp y/y), and said provision should normalize around $20–$25M (Q2 provision $26M; ~45% tied to growth ≈$12M, 40% to an exited distillery portfolio, 15% macro/other) while unguaranteed ACL coverage was 2.01% (-13 bps q/q) and ~87% of loans were originated at current or higher rates. Strategic growth priorities include Live Oak Express reaching at least $750M annual originations (Q2 Express $82M, gain on sale $5M, premiums ~1.09–1.13), growing checking balances ($469M; total DDA $744M ≈5% of $14.5B deposits with a ≥10% DDA goal), a ~$13B loan book (4% q/q, 16% y/y) and a $4.6B pipeline, underpinning management’s view of sustainable, revenue‑led earnings momentum.Live Oak Bancshares Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
82
Very Positive
Cash Flow
42
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.08B | 1.04B | 929.29M | 776.55M | 508.83M | 506.41M |
| Gross Profit | 545.11M | 503.00M | 396.61M | 382.26M | 350.92M | 426.77M |
| EBITDA | 226.11M | 185.09M | 112.52M | 104.10M | 231.11M | 232.15M |
| Net Income | 137.47M | 103.78M | 77.47M | 73.90M | 176.21M | 167.00M |
Balance Sheet | ||||||
| Total Assets | 16.04B | 15.13B | 12.94B | 11.27B | 9.86B | 8.21B |
| Cash, Cash Equivalents and Short-Term Investments | 927.63M | 1.73B | 634.39M | 1.71B | 1.30B | 1.10B |
| Total Debt | 99.77M | 102.40M | 112.82M | 23.35M | 83.20M | 318.29M |
| Total Liabilities | 14.72B | 13.88B | 11.94B | 10.37B | 9.04B | 7.50B |
| Stockholders Equity | 1.31B | 1.25B | 999.03M | 902.67M | 811.03M | 715.13M |
Cash Flow | ||||||
| Free Cash Flow | -52.23M | 143.49M | 487.16M | 573.23M | 80.73M | -122.80M |
| Operating Cash Flow | -36.33M | 158.24M | 536.47M | 620.07M | 124.48M | -119.72M |
| Investing Cash Flow | -1.72B | -1.90B | -2.08B | -1.77B | -1.44B | -149.80M |
| Financing Cash Flow | 2.02B | 2.00B | 1.57B | 1.32B | 1.53B | 154.95M |
Live Oak Bancshares Technical Analysis
Neutral
42.08
Price Trends
41.51
Negative
39.11
Positive
37.22
Positive
Market Momentum
-0.01
Positive
41.56
Neutral
13.18
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOB, the sentiment is Neutral. The current price of 42.08 is below the 20-day moving average (MA) of 42.61, above the 50-day MA of 41.51, and above the 200-day MA of 37.22, indicating a neutral trend. The MACD of -0.01 indicates Positive momentum. The RSI at 41.56 is Neutral, neither overbought nor oversold. The STOCH value of 13.18 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LOB.
Live Oak Bancshares Risk Analysis
Live Oak Bancshares disclosed 50 risk factors in its most recent earnings report. Live Oak Bancshares 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
Live Oak Bancshares Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $2.07B | 12.30 | 13.41% | 1.88% | 4.24% | 21.67% | |
82 Outperform | $2.02B | 15.81 | 16.41% | 2.49% | 3.23% | 10.13% | |
76 Outperform | $1.77B | 13.47 | 9.74% | 2.74% | 2.44% | 10.69% | |
72 Outperform | $1.89B | 14.23 | 10.91% | 0.29% | 7.11% | 132.73% | |
72 Outperform | $1.86B | 16.28 | 6.47% | 2.94% | 8.27% | -23.33% | |
57 Neutral | $1.88B | 22.51 | 2.59% | 4.09% | 10.46% | -39.66% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
* General Sector Average
LOB
Live Oak Bancshares
40.98
3.41
9.06%
SRCE
1St Source
85.83
23.60
37.92%
CHCO
City Holding Company
144.48
19.24
15.36%
OCFC
Oceanfirst Financial
19.06
1.72
9.90%
STBA
S&T Bancorp
50.38
12.61
33.38%
NBHC
National Bank Holdings
41.85
3.87
10.20%
Live Oak Bancshares Corporate Events
Dividends
Live Oak Bancshares Declares Dividends for Shareholders
Positive
Aug 18, 2026
On August 18, 2026, Live Oak Bancshares, Inc. announced that its Board of Directors declared a cash dividend of $0.03 per share on its Voting Common Stock. The dividend is scheduled to be paid on September 15, 2026 to shareholders of record as of ...
Business Operations and StrategyExecutive/Board Changes
Live Oak Bancshares appoints new principal accounting officer
Positive
Jul 2, 2026
On June 29, 2026, Live Oak Banking Company hired Matthew S. Diffley, 46, as Chief Accounting Officer, and effective July 1, 2026, the board of Live Oak Bancshares, Inc. appointed him as Principal Accounting Officer, succeeding interim PAO Walter J...
Executive/Board Changes
Live Oak Bancshares Announces Interim Accounting Leadership Change
Neutral
Jun 18, 2026
Live Oak Bancshares announced on June 18, 2026, that J. Wesley Sutherland will no longer serve as Chief Accounting Officer of the company or Live Oak Banking Company. Effective June 16, 2026, Chief Financial Officer Walter J. Phifer assumed the ro...
Business Operations and StrategyShareholder Meetings
Live Oak Shareholders Approve Governance and Equity Incentive Plans
Positive
May 22, 2026
At its annual meeting of shareholders held on May 19, 2026, Live Oak Bancshares, Inc. reported that 42,159,893 of 46,239,891 eligible shares were represented, establishing a quorum and enabling votes on key governance items. Shareholders elected t...
Dividends
Live Oak Bancshares Declares Cash Dividends on Shares
Positive
May 19, 2026
On May 19, 2026, Live Oak Bancshares, Inc.’s Board of Directors declared a cash dividend of $0.03 per share on its Voting Common Stock, payable on June 15, 2026 to shareholders of record as of June 2, 2026. The Board also approved a cash div...
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.