Southern Michigan Bancorp (SOMC) AI Stock Analysis

Southern Michigan Bancorp

(Other OTC:SOMC)

Select Model

Rating:73Outperform

Price Target:$35.00▲(18.28% Upside)

Action:reiterated

Date:08/06/26

The score is driven primarily by solid financial performance, highlighted by strong 2025 revenue and cash-flow improvement alongside manageable leverage, though tempered by margin compression and historical volatility. Technicals add support with price above key moving averages and neutral-to-positive momentum. Valuation contributes positively with a reasonable P/E and a modest dividend yield.

Positive Factors

Strong Revenue and Earnings GrowthThe sharp 2025 revenue acceleration and accompanying earnings increase indicate stronger operating scale and customer activity. If sustained, this growth can expand the community bank’s earnings base and improve its ability to invest in products, staffing, and market coverage.

Negative Factors

Margin CompressionThe decline in profitability margins suggests that revenue growth is not translating into earnings as efficiently as before. Persistent pressure from funding costs, loan pricing, operating expenses, or credit provisions could limit future earnings growth and returns.

Southern Michigan Bancorp (SOMC) vs. SPDR S&P 500 ETF (SPY)

Market Cap: $132.90M
Dividend Yield: 2.27%
Average Volume (3M): 3,968
Price to Earnings (P/E): 10.9
Beta (1Y): 0.35
Revenue Growth: 6.48%
EPS Growth: 4.50%
Country: US
Employees: 258
Sector: Financial
Sector Strength: 68
Industry: Banks - Regional

Southern Michigan Bancorp Business Overview & Revenue Model

Company Description

Southern Michigan Bancorp, Inc. serves as the bank holding company for Southern Michigan Bank & Trust, delivering a comprehensive array of commercial banking solutions. These services cater to individuals, businesses, institutions, and governmental a...

How the Company Makes Money

Southern Michigan Bancorp makes money primarily through its community banking operations. Its largest revenue driver is typically net interest income: the bank earns interest and fee income on loans and other interest-earning assets (such as commerci...

Southern Michigan Bancorp Financial Statement Overview

Summary

Overall fundamentals are solid, led by a sharp 2025 revenue acceleration ($48.6M to $93.2M) and improved cash generation (operating cash flow $22.1M; free cash flow $20.3M). Profitability remains healthy (net margin ~13%, EBIT margin ~15%), and leverage looks manageable with debt-to-equity improving to ~1.10. The score is tempered by margin compression versus prior years and notable year-to-year volatility in revenue and free cash flow.

Income Statement

74Positive

Balance Sheet

63Positive

Cash Flow

70Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	96.16M	93.17M	48.56M	46.81M	51.51M	46.15M
Gross Profit	56.29M	54.06M	48.56M	73.31M	51.51M	46.15M
EBITDA	14.52M	14.39M	14.02M	14.94M	17.48M	15.56M
Net Income	12.32M	12.21M	10.40M	10.90M	13.49M	11.76M
Balance Sheet
Total Assets	1.68B	1.69B	1.50B	1.42B	1.28B	1.16B
Cash, Cash Equivalents and Short-Term Investments	81.17M	110.38M	69.50M	73.09M	75.70M	117.85M
Total Debt	133.51M	134.08M	117.98M	146.54M	89.25M	77.92M
Total Liabilities	1.56B	1.57B	1.39B	1.32B	1.19B	1.07B
Stockholders Equity	126.25M	121.48M	107.22M	97.83M	86.16M	97.75M
Cash Flow
Free Cash Flow	0	20.26M	2.85M	7.90M	8.36M	9.90M
Operating Cash Flow	0	22.11M	7.84M	16.24M	13.19M	13.68M
Investing Cash Flow	0	-157.40M	-76.58M	-141.57M	-179.38M	-148.72M
Financing Cash Flow	0	175.92M	66.36M	119.69M	124.06M	154.82M

Southern Michigan Bancorp Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

SOMC against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MGYR	78Outperform	$143.96M	11.04	10.23%	1.70%	8.91%	30.08%
SOMC	73Outperform	$137.38M	10.94	10.18%	2.27%	6.48%	4.50%
Sector *	68Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
UNB	63Neutral	$112.91M	8.68	15.07%	6.31%	3.17%	5.55%
BSBK	57Neutral	$116.51M	42.66	1.34%	―	21.45%	―
SRBK	54Neutral	$134.47M	36.84	2.02%	1.17%	9.63%	37.01%
RVSB	49Neutral	$119.92M	-41.56	-2.02%	1.33%	-10.03%	-162.70%

* Financial Sector Average

Performance Comparison

SOMC and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
SOMC	Southern Michigan Bancorp	29.55	6.14	26.21%
MGYR	Magyar Bancorp	22.30	5.42	32.14%
RVSB	Riverview	6.01	0.89	17.29%
UNB	Union Bankshares, Inc.	22.83	1.35	6.28%
BSBK	Bogota Financial Corp.	9.13	0.46	5.31%
SRBK	SR Bancorp, Inc.	18.79	4.21	28.89%

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: Aug 06, 2026

Southern Michigan Bancorp AI Stock Analysis