Orrstown Financial Services (ORRF) AI Stock Analysis

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Orrstown Financial Services

(NASDAQ:ORRF)

Select Model

Outperform 78 (OpenAI - 4o)

Rating:78Outperform

Price Target:

$38.00

▲(9.07% Upside)

Orrstown Financial Services exhibits strong financial performance and positive earnings call insights, driving a high score. The valuation is attractive with a low P/E ratio and solid dividend yield. Technical analysis indicates a lack of strong momentum, slightly dampening the overall score.

Orrstown Financial Services (ORRF) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$658.08M

Dividend Yield3.14%

Average Volume (3M)128.18K

Price to Earnings (P/E)8.9

Beta (1Y)0.91

Revenue Growth47.65%

EPS Growth101.00%

CountryUS

Employees607

SectorFinancial

Sector Strength70

IndustryBanks - Regional

Share Statistics

EPS (TTM)1.13

Shares Outstanding19,498,770

10 Day Avg. Volume149,130

30 Day Avg. Volume128,179

Financial Highlights & Ratios

PEG Ratio-0.43

Price to Book (P/B)1.05

Price to Sales (P/S)1.90

P/FCF Ratio16.19

Enterprise Value/Market Cap1.35

Enterprise Value/Revenue2.89

Enterprise Value/Gross Profit3.86

Enterprise Value/Ebitda12.70

Forecast

1Y Price Target

$40.50

Price Target Upside16.25% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

EPS Forecast (FY)4.23

Revenue Forecast (FY)$250.90M

Orrstown Financial Services Business Overview & Revenue Model

Company DescriptionOrrstown Financial Services (ORRF) is a financial holding company based in Pennsylvania, primarily engaged in providing a range of banking, investment, and insurance services. The company operates through its subsidiary, Orrstown Bank, which offers traditional banking products including checking and savings accounts, loans, and mortgages, along with wealth management and trust services. Additionally, Orrstown Financial Services provides financial planning and investment advisory services, catering to both individual and commercial clients across its regional footprint.

How the Company Makes MoneyOrrstown Financial Services generates revenue through several key streams: interest income from loans and mortgages, fees from banking services such as account maintenance and transaction services, and investment management fees from its wealth management and advisory services. The company also earns income through insurance premiums collected from its insurance offerings. Strategic partnerships with financial institutions and investment firms enhance its service portfolio and client base, contributing to its overall profitability. Additionally, the bank may benefit from economic factors such as interest rate fluctuations, which can impact its net interest margin.

Orrstown Financial Services Earnings Call Summary

Earnings Call Date:Oct 21, 2025

(Q3-2025)

% Change Since: |

Next Earnings Date:Jan 27, 2026

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance with notable growth in loans, improved net interest margin, and record earnings. However, concerns about increasing nonaccrual loans and competitive pressures affecting net interest margin were also discussed.

Q3-2025 Updates

Positive Updates

Strong Loan Growth

Achieved a 4.9% annualized loan growth in the third quarter, demonstrating strong performance after aligning the acquired portfolio with the company's risk profile.

Net Interest Margin Improvement

Net interest margin increased to 4.11% in Q3 from 4.07% in Q2, indicating effective pricing and funding cost management.

Record Quarterly Earnings

Reported the strongest quarter of earnings on record with diluted EPS of $1.13, a return on assets of 1.60%, and a return on equity of nearly 16%.

Fee Income Stability

Fee income remained a core strength, accounting for 20.8% of operating revenue, maintaining nearly 21% for two consecutive quarters.

Reduction in Noninterest Expense

Noninterest expense declined by $1.3 million compared to the prior quarter, improving the efficiency ratio from 60.3% to 56.4%.

Capital Position Strength

The company is well-capitalized by all measures, providing significant strategic flexibility for future growth.

Negative Updates

Increase in Nonaccrual Loans

Nonaccrual loans increased by $3.8 million to $26.2 million, primarily due to one relationship within the commercial construction and development portfolio.

Competitive Pressure on NIM

Heavy competition on both loan and deposit pricing is expected to influence the ability to maintain or increase the net interest margin.

Asset Sensitivity Concerns

Being asset sensitive, margins are expected to contract as rates come down, with competition further impacting pricing strategies.

Company Guidance

During the Orrstown Financial Services, Inc. Third Quarter 2025 Earnings Conference Call, the company provided several positive financial metrics reflecting their strong performance. The company reported a 4.9% annualized loan growth, demonstrating a robust lending strategy. Their net interest margin improved slightly to 4.11% from 4.07% in the previous quarter, showcasing effective loan pricing and funding cost management. Fee income remained strong, comprising 20.8% of operating revenue. Additionally, noninterest expenses decreased by $1.3 million, resulting in a more efficient operation with an efficiency ratio dropping from 60.3% to 56.4%. These efforts culminated in a record quarterly earnings with a diluted EPS of $1.13, a return on assets of 1.60%, and a return on equity nearly reaching 16%. Overall, the company expressed optimism about sustaining this growth trajectory while maintaining robust credit quality and strategic flexibility in capital management.

Orrstown Financial Services Financial Statement Overview

Summary

Orrstown Financial Services demonstrates strong financial health with consistent revenue and profit growth. The balance sheet reflects a stable financial position with manageable leverage. Cash flow generation is robust, although there is room for improvement in cash conversion efficiency. Overall, the company is well-positioned for continued growth and stability.

Income Statement

Very Positive

Orrstown Financial Services shows strong revenue growth with a TTM increase of 4.12%. The gross profit margin is robust at 74.88%, indicating efficient cost management. Net profit margin improved to 14.04%, reflecting enhanced profitability. EBIT and EBITDA margins are healthy, supporting operational efficiency.

Balance Sheet

Positive

The company's debt-to-equity ratio is moderate at 0.46, suggesting a balanced approach to leveraging. Return on equity is reasonable at 8.19%, indicating effective use of equity to generate profits. The equity ratio is stable, reflecting a solid capital structure.

Cash Flow

Very Positive

Free cash flow growth is impressive at 58.80%, showcasing strong cash generation capabilities. The operating cash flow to net income ratio is low, suggesting potential areas for improvement in cash conversion. However, the free cash flow to net income ratio is high at 91.06%, indicating efficient cash utilization.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	308.30M	284.09M	174.30M	134.32M	121.64M	126.88M
Gross Profit	230.84M	173.86M	127.62M	121.11M	113.83M	105.53M
EBITDA	70.15M	37.50M	49.37M	31.24M	46.20M	39.08M
Net Income	43.28M	22.05M	35.66M	22.04M	32.88M	26.46M
Balance Sheet
Total Assets	5.39B	5.44B	3.06B	2.92B	2.83B	2.75B
Cash, Cash Equivalents and Short-Term Investments	939.71M	1.08B	578.68M	574.55M	681.15M	591.72M
Total Debt	250.59M	209.91M	179.38M	155.42M	57.16M	109.41M
Total Liabilities	4.84B	4.92B	2.80B	2.69B	2.56B	2.50B
Stockholders Equity	548.45M	516.68M	265.06M	228.90M	271.66M	246.25M
Cash Flow
Free Cash Flow	46.70M	33.38M	41.41M	35.30M	39.56M	28.87M
Operating Cash Flow	51.29M	34.96M	43.70M	36.19M	40.81M	30.17M
Investing Cash Flow	91.62M	60.99M	-153.25M	-270.99M	-2.01M	-292.56M
Financing Cash Flow	-126.03M	87.76M	113.89M	86.91M	44.65M	331.47M

Orrstown Financial Services Technical Analysis

Technical Analysis Sentiment

Positive

Last Price34.84

Price Trends

50DMA

33.89

Negative

100DMA

33.29

Positive

200DMA

31.76

Positive

Market Momentum

MACD

>-0.01

Negative

RSI

52.10

Neutral

STOCH

59.33

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ORRF, the sentiment is Positive. The current price of 34.84 is above the 20-day moving average (MA) of 33.36, above the 50-day MA of 33.89, and above the 200-day MA of 31.76, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 52.10 is Neutral, neither overbought nor oversold. The STOCH value of 59.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ORRF.

Orrstown Financial Services Risk Analysis

Orrstown Financial Services disclosed 52 risk factors in its most recent earnings report. Orrstown Financial Services 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

Orrstown Financial Services Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ORRF	78 Outperform	$658.08M	8.93	13.43%	3.14%	47.65%	101.00%
FSBC	78 Outperform	$733.35M	12.74	13.95%	2.32%	22.24%	18.63%
NBBK	74 Outperform	$666.95M	11.78	7.84%	0.76%	14.04%	337.54%
CAC	72 Outperform	$652.45M	10.99	9.49%	4.33%	24.08%	9.83%
THFF	71 Outperform	$636.50M	8.60	12.46%	3.64%	16.57%	69.64%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
GSBC	67 Neutral	$633.93M	9.30	11.18%	2.85%	0.67%	17.88%

* Financial Sector Average

Performance Comparison

ORRF

Orrstown Financial Services

33.75

-6.04

-15.19%

CAC

Camden National

38.83

-8.64

-18.20%

THFF

First Financial Indiana

56.12

8.06

16.77%

GSBC

Great Southern Bancorp

57.18

-5.42

-8.65%

FSBC

Five Star

34.41

2.34

7.30%

NBBK

NB Bancorp, Inc.

18.52

-2.02

-9.83%

Orrstown Financial Services Corporate Events

Orrstown Financial Services Reports Record Earnings Amid Growth

Oct 24, 2025

The latest earnings call from Orrstown Financial Services painted a picture of robust financial health, characterized by notable growth in loans, an improved net interest margin, and record-breaking earnings. However, the discussion was tempered by concerns over rising nonaccrual loans and competitive pressures that could impact future net interest margins.

Business Operations and StrategyPrivate Placements and Financing

Orrstown Financial Approves $32.5M Notes Redemption

Neutral

Aug 29, 2025

On August 27, 2025, Orrstown Financial Services‘ Board of Directors approved the redemption of $32.5 million in outstanding subordinated notes due in 2028, with the redemption set for September 30, 2025. This strategic financial move will involve redeeming the notes at their principal amount plus any accrued interest, potentially impacting the company’s financial structure and stakeholder interests.

The most recent analyst rating on (ORRF) stock is a Buy with a $37.00 price target. To see the full list of analyst forecasts on Orrstown Financial Services stock, see the ORRF Stock Forecast page.

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.Date of analysis: Oct 30, 2025