TowneBank (TOWN) AI Stock Analysis

• Market Cap: $2.74B
• Dividend Yield: 3.08%
• Average Volume (3M): 311.39K
• Price to Earnings (P/E): 14.6
• Beta (1Y): 0.93
• Revenue Growth: 8.34%
• EPS Growth: 14.44%
• Country: US
• Employees: 2,704
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.81
• 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: 1.01
• Enterprise Value/Revenue: 3.08
• Enterprise Value/Gross Profit: 3.75
• Enterprise Value/Ebitda: 11.05
• 1Y Price Target: $39.33
• Price Target Upside: 17.47% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 64 Neutral
• Price Target: $36.00 ▲(7.53% Upside)

TowneBank's overall stock score reflects strong financial performance with solid revenue growth and efficient cost management. However, technical analysis indicates bearish momentum, and cash flow challenges present potential risks. Valuation is reasonable but not particularly attractive, contributing to a moderate overall score.

TowneBank Business Overview & Revenue Model

Company Description

TowneBank (TOWN) is a regional bank headquartered in Portsmouth, Virginia, offering a full range of financial services to individuals, businesses, and communities. The bank operates primarily in the banking and financial services sector, providing products such as personal and commercial banking, mortgage lending, investment services, and insurance. TowneBank is committed to enhancing the financial well-being of its customers while contributing positively to the communities it serves.

How the Company Makes Money

TowneBank generates revenue primarily through interest income from loans, which includes personal loans, mortgages, and commercial loans. The bank charges interest on these loans, which constitutes a significant portion of its earnings. Additionally, TowneBank earns non-interest income through fees for services such as account maintenance, ATM transactions, wealth management, and insurance products. The bank's investment income from its securities portfolio also contributes to its revenue. Strategic partnerships with other financial institutions and businesses enhance its service offerings and customer base, further supporting its earnings.

TowneBank Financial Statement Overview

Summary

TowneBank's financial health is robust, with strong profitability metrics, a stable balance sheet, and effective cash flow management. The income statement shows consistent revenue generation and profitability, while the balance sheet demonstrates low leverage and stability. The cash flow statement highlights efficient cash management, supporting the bank's growth and operational needs.

Income Statement

TowneBank shows strong profitability metrics with a consistent increase in total revenue over the years, indicating a positive growth trajectory. The TTM data reveals a gross profit margin of approximately 69.3%, and a net profit margin of 17.2%, both of which are commendable for a regional bank. The EBIT and EBITDA margins are also robust at 20.1% and 23.4% respectively, demonstrating operational efficiency. However, the revenue growth rate from the previous year is modest at 0.91%, which suggests a need for acceleration in revenue generation.

Balance Sheet

The balance sheet remains stable with a debt-to-equity ratio of 0.13, indicating low leverage and a strong capacity to manage debt. The equity ratio stands at 12.6%, highlighting a stable financial foundation. The return on equity (ROE) is 8.1%, which, while positive, suggests room for improvement to enhance shareholder returns. Overall, the balance sheet reflects a sound financial position with limited leverage risks.

Cash Flow

Cash flow analysis reveals strong cash management with a healthy free cash flow growth rate of 101.7% year-over-year. The operating cash flow to net income ratio is 1.25, indicating effective cash conversion. The free cash flow to net income ratio of 0.92 shows efficient capital expenditure management. The cash flow statement underscores TowneBank's ability to generate and manage cash effectively, supporting operational and strategic initiatives.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	901.90M	1.02B	942.55M	742.95M	697.10M	742.25M
Gross Profit	740.59M	692.51M	676.41M	677.14M	695.77M	595.06M
EBITDA	251.02M	225.55M	220.44M	265.75M	310.96M	230.39M
Net Income	173.64M	161.76M	153.72M	188.99M	215.38M	145.53M
Balance Sheet
Total Assets	18.26B	17.25B	16.84B	15.85B	16.36B	14.63B
Cash, Cash Equivalents and Short-Term Investments	1.18B	1.40B	3.26B	2.99B	5.10B	3.23B
Total Debt	294.12M	296.90M	492.58M	318.01M	481.82M	772.88M
Total Liabilities	16.03B	15.09B	14.78B	13.96B	14.45B	12.84B
Stockholders Equity	2.31B	2.14B	2.04B	1.87B	1.90B	1.77B
Cash Flow
Free Cash Flow	101.00M	81.09M	117.17M	363.22M	487.62M	82.10M
Operating Cash Flow	165.88M	138.36M	161.30M	415.50M	518.82M	127.89M
Investing Cash Flow	-686.08M	-202.77M	-335.68M	-2.05B	-547.36M	-1.12B
Financing Cash Flow	330.45M	275.53M	149.90M	-512.10M	1.46B	2.41B

TowneBank Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 33.48
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TOWN, the sentiment is Negative. The current price of 33.48 is below the 20-day moving average (MA) of 34.11, below the 50-day MA of 35.24, and below the 200-day MA of 34.25, indicating a bearish trend. The MACD of -0.56 indicates Positive momentum. The RSI at 43.86 is Neutral, neither overbought nor oversold. The STOCH value of 51.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TOWN.

TowneBank Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WSBC	73 Outperform	$3.02B	18.46	4.25%	4.82%	30.52%	-21.64%
CVBF	71 Outperform	$2.62B	12.69	9.30%	4.21%	-5.14%	-0.70%
SFNC	68 Neutral	$2.65B	14.20	-12.42%	4.68%	-55.54%	-386.73%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
BKU	67 Neutral	$2.78B	10.64	8.98%	3.30%	-2.80%	51.85%
TOWN	64 Neutral	$2.74B	14.64	8.07%	3.08%	8.34%	14.44%
FBK	64 Neutral	$2.87B	24.37	5.85%	1.39%	10.80%	-6.22%