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Live Oak Bancshares
(NYSE:LOB)
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Rating:63Neutral
Price Target:
$38.00
▼(-4.98% Downside)
Action:Reiterated
Date:10/22/26
The score is driven primarily by improving profitability and a conservatively levered balance sheet, tempered by a sharp deterioration in TTM operating/free cash flow. Technicals are also weak with the stock trading below key moving averages and negative momentum indicators. Valuation is reasonable but the dividend yield is minimal, while the latest earnings call was constructive yet flagged meaningful credit/provision uncertainty.
Positive Factors
Loan Growth
Record originations and strong loan-balance growth show that Live Oak is expanding its specialized lending franchise and capturing demand across multiple industries. Sustained volume growth can support recurring net interest income, gain-on-sale revenue, and operating leverage over the next several quarters.
Negative Factors
Distillery Exposure
The distillery portfolio remains a material source of uncertainty despite representing only about one-half of one percent of total loans. Declining spirits demand, excess inventory, and falling collateral values could require additional provisions and prolong management attention before the exposure is fully resolved.
Read all positive and negative factors
Positive Factors
Negative Factors
Loan Growth
Record originations and strong loan-balance growth show that Live Oak is expanding its specialized lending franchise and capturing demand across multiple industries. Sustained volume growth can support recurring net interest income, gain-on-sale revenue, and operating leverage over the next several quarters.
Read all positive factors
Live Oak Bancshares Key Performance Indicators (KPIs)
Live Oak Bancshares (LOB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.63B
Dividend Yield0.34%
Average Volume (3M)240.15K
Price to Earnings (P/E)12.4
Beta (1Y)1.01
Revenue Growth8.59%
EPS Growth88.76%
CountryUS
Employees1,027
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)2.88
Shares Outstanding46,283,620
10 Day Avg. Volume251,753
30 Day Avg. Volume240,145
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 Cap0.49
Enterprise Value/Revenue0.74
Enterprise Value/Gross Profit1.46
Enterprise Value/Ebitda3.43
Forecast
1Y Price Target
$41.25Price Target Upside3.15% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
EPS Forecast (FY)2.96
Revenue Forecast (FY)$649.72M
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 by earning interest income on loans and generating fee-based income associated with loan origination and servicing. The company’s core revenue streams typically include: (1) ...
Live Oak Bancshares Earnings Call Summary
Earnings Call Date:Oct 21, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Jan 27, 2027
Earnings Call Sentiment Positive
The call was predominantly positive. Management emphasized record loan production, strong adjusted earnings power, improving efficiency, expanding SBA and checking franchises, accelerating AI adoption, stable small business credit, and healthy capital. These strengths were partly offset by the $17 million distillery provision, elevated total provision expense, remaining distillery workout exposure, lumpy commercial credit results, and competitive funding costs.Positive Updates
Record Adjusted Pre-Provision Earnings and Operating Leverage
Adjusted revenue grew 15% year-over-year to $172 million while adjusted expenses grew only 1%, producing record adjusted PPNR of $88 million, up 33% year-over-year and 16% from the prior quarter. The adjusted efficiency ratio improved from 56% to 49% year-over-year.
Negative Updates
Distillery Portfolio Charge Reduced Reported EPS
Reported EPS was $0.52, which management said was below its desired and expected result. The primary driver was a $17 million provision on the exited distillery portfolio, reducing EPS by approximately $0.27. Excluding that action, adjusted EPS would have been $0.76; reported adjusted EPS including the distillery impact was $0.49.
Read all updates
Q3-2026 Updates
Positive
Negative
Record Adjusted Pre-Provision Earnings and Operating Leverage
Adjusted revenue grew 15% year-over-year to $172 million while adjusted expenses grew only 1%, producing record adjusted PPNR of $88 million, up 33% year-over-year and 16% from the prior quarter. The adjusted efficiency ratio improved from 56% to 49% year-over-year.
Read all positive updates
Company Guidance
Management’s target for Live Oak Express at cruise altitude remains over $750 million annually, checking’s target is 10% and above, and they expect merchant services to continue to accelerate checking account growth; they still view a flat to rising rate environment as a favorable backdrop, with volume growth remaining the primary driver of net interest income, and their overall assumption is that the margin remains relatively stable while net interest income will continue to grow at the same pace as the balance sheet. A 25 basis point rate hike typically equates anywhere from $5 million-$10 million on an annual basis of accretion, they expect modest expense growth with continued improvement in the efficiency ratio over time, and they are not going to replace the range previously discussed with a new one or say that this steps down next quarter; for distillery, their goal is to exit as quickly as possible on every one of these credits.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 | 232.40M | 191.38M | 112.52M | 104.10M | 231.10M | 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
Negative
39.99
Price Trends
37.90
Negative
39.43
Negative
38.10
Negative
Market Momentum
-0.79
Negative
40.66
Neutral
65.89
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOB, the sentiment is Negative. The current price of 39.99 is above the 20-day moving average (MA) of 35.45, above the 50-day MA of 37.90, and above the 200-day MA of 38.10, indicating a bearish trend. The MACD of -0.79 indicates Negative momentum. The RSI at 40.66 is Neutral, neither overbought nor oversold. The STOCH value of 65.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $2.10B | 11.96 | 13.75% | 1.92% | 3.90% | 20.76% | |
72 Outperform | $1.99B | 15.54 | 16.41% | 2.54% | 3.23% | 10.13% | |
72 Outperform | $1.78B | 12.89 | 10.12% | 2.89% | 2.26% | ― | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
64 Neutral | $1.72B | 15.13 | 6.47% | 3.27% | 8.27% | -23.33% | |
63 Neutral | $1.63B | 12.38 | 10.67% | 0.34% | 8.59% | 88.76% | |
57 Neutral | $1.65B | 19.73 | 2.59% | 4.79% | 10.46% | -39.66% |
* Financial Sector Average
LOB
Live Oak Bancshares
35.15
2.35
7.16%
SRCE
1St Source
87.29
29.13
50.09%
CHCO
City Holding Company
142.01
25.17
21.55%
OCFC
Oceanfirst Financial
16.71
-1.10
-6.19%
STBA
S&T Bancorp
50.52
14.94
42.01%
NBHC
National Bank Holdings
38.88
2.84
7.87%
Live Oak Bancshares Corporate Events
Business Operations and StrategyExecutive/Board Changes
Live Oak Bancshares Chief Information Officer Resigns
Negative
Oct 20, 2026
On October 14, 2026, Live Oak Bancshares announced that Renato Derraik resigned from his role as Chief Information Digital Officer of Live Oak Banking Company to pursue other endeavors, with his last day set for November 6, 2026. The departure of...
Regulatory Filings and Compliance
Live Oak Bancshares CEO Adopts New 10b5-1 Trading Plan
Neutral
Aug 28, 2026
On August 28, 2026, Live Oak Bancshares, Inc. disclosed that Chairman and Chief Executive Officer James S. Mahan III adopted a prearranged Rule 10b5-1 stock trading plan as part of his long-term personal financial and tax planning. The plan allows...
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 ...
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.