Breaking Down FB Financial Corporation (FBK) Financial Health: Key Insights for Investors

Are you looking to gain a deeper understanding of FB Financial Corporation's (FBK) financial performance? Did you know that in the fourth quarter of 2024, the company reported a net income of $37.9 million, equating to $0.81 per diluted common share? Or that their loans held for investment reached $9.60 billion? This article dives into the key financial insights from 2024, exploring critical metrics like net interest margin, deposit growth, and asset quality to provide investors with a comprehensive overview of the company's financial health and strategic direction.

FB Financial Corporation (FBK) Revenue Analysis

FB Financial Corporation (FBK) generates revenue primarily through net interest income, which is the difference between the income earned from interest-bearing assets and the expense incurred from interest-bearing liabilities. Additionally, the company earns revenue from service charges and fees.

For the fiscal year 2024, FB Financial Corporation reported a net income available to common shareholders of $92.9 million, or $3.30 per diluted common share. This compares to a net income of $131.7 million, or $4.53 per diluted common share, for the fiscal year 2023.

Here is a summary of the changes in key financial metrics:

• Net income available to common shareholders decreased from $131.7 million in 2023 to $92.9 million in 2024.
• Earnings per diluted common share decreased from $4.53 in 2023 to $3.30 in 2024.

A more detailed breakdown of the revenue streams and their changes can be summarized as follows:

Net interest income is significantly impacted by the yield on earning assets and the cost of funding those assets. Changes in market interest rates, the composition of the loan portfolio, and deposit costs all play a role.

Non-interest income includes service charges and fees, wealth management income, and other fees. These revenue streams are generally more stable and less sensitive to interest rate fluctuations.

Here's a look at the consolidated balance sheets:

Understanding these revenue streams and their drivers is crucial for investors. Analyzing the trends in net interest income, non-interest income, and the factors influencing them provides valuable insights into FB Financial Corporation's financial performance and stability. You might also be interested in: Mission Statement, Vision, & Core Values of FB Financial Corporation (FBK).

FB Financial Corporation (FBK) Profitability Metrics

Analyzing FB Financial Corporation (FBK)'s financial health involves a detailed look at its profitability metrics. This includes examining gross profit, operating profit, and net profit margins to understand the company's efficiency and overall financial performance.

As of the full year 2024 results, FB Financial Corporation reported:

• Revenue: US$443.6 million (down 6.7% from FY 2023)
• Net Income: US$116.0 million (down 3.5% from FY 2023)
• Earnings Per Share (EPS): US$2.48 (down from US$2.57 in FY 2023)

For the fourth quarter of 2024, the company's performance included:

• Net Income: $37.9 million, or $0.81 per diluted common share
• Adjusted Net Income: $39.8 million, or $0.85 per diluted common share

A look at FB Financial Corporation's key profitability metrics:

Gross Profit Margin:

As of the most recent financial reports, FBK's gross profit margin stood at 55.8%. For the full year 2024, the gross profit is calculated as:

• Revenue: $465.3 million
• Cost of Revenue: $0
• Gross Profit: $465.3 million

Operating Profit Margin:

FB Financial's operating margin as of March 2025 (TTM) was 32.19%. At the end of 2024, the company had an operating margin of 32.19%. The operating margin history from 2016 to 2024 shows the following trends:

Net Profit Margin:

For Q4 2024, FB Financial Corp.'s net profit margin jumped 89.55% since the same period last year to 29.06%. For the year 2024, the net profit margin was approximately 26%, aligning with the FY 2023 figure.

Operational Efficiency:

FB Financial Corporation's operational efficiency can be assessed through several key metrics:

• Cost Management: The efficiency ratio improved significantly, indicating better cost management. In the fourth quarter of 2024, the core efficiency ratio was 54.6%, compared to 58.4% in the previous quarter and 61.7% in the fourth quarter of 2023.
• Gross Margin Trends: The company's gross margin has experienced some volatility, but as of the most recent reports, the gross profit margin stood at 55.8%.
• Net Interest Margin (NIM): For the fourth quarter of 2024, NIM was 3.50%, compared to 3.55% in the prior quarter and 3.46% in the fourth quarter of 2023.

Furthermore, FB Financial has demonstrated effective deposit cost management. In the first quarter of 2025, the bank's net interest margin expanded to 3.55% from 3.42% in Q1 2024, driven by a decrease in total deposit costs to 2.54% from 2.70% in Q4.

See Mission Statement, Vision, & Core Values of FB Financial Corporation (FBK).

FB Financial Corporation (FBK) Debt vs. Equity Structure

Understanding how FB Financial Corporation (FBK) finances its operations and growth is crucial for investors. This involves analyzing the company's debt levels, its debt-to-equity ratio, and how it strategically uses debt versus equity to fund its activities. For additional insights, you can explore Breaking Down FB Financial Corporation (FBK) Financial Health: Key Insights for Investors.

As of the end of 2024, FB Financial Corporation (FBK) exhibits a financial structure that incorporates both short-term and long-term debt. A detailed look into their balance sheet reveals the specifics:

• Short-Term Debt: FB Financial Corporation carries $47.9 million in short-term debt, representing obligations due within one year.
• Long-Term Debt: The company's long-term debt stands at $132.4 million, covering liabilities extending beyond the coming year.

The debt-to-equity ratio is a key metric in assessing a company's financial leverage. It indicates the proportion of debt and equity a company uses to finance its assets. Here's how FB Financial Corporation's (FBK) debt-to-equity ratio stacks up:

FB Financial Corporation (FBK) has a debt-to-equity ratio of 0.22. This ratio is calculated by dividing the total liabilities by shareholders equity. This indicates that FB Financial Corporation (FBK) uses $0.22 of debt for every dollar of equity.

To provide a clearer picture, here's a comparison of FB Financial Corporation's (FBK) debt-to-equity ratio against industry standards:

FB Financial Corporation's (FBK) debt-to-equity ratio is lower than the industry average, suggesting that the company relies less on debt financing compared to its peers.

Investors should monitor any recent debt issuances, credit ratings, or refinancing activities, as these can significantly impact the company's financial health and its ability to meet its obligations. Keeping an eye on these factors provides a more complete understanding of FB Financial Corporation's (FBK) financial strategy and risk profile.

Striking the right balance between debt and equity is vital for sustainable growth. Too much debt can increase financial risk, while relying solely on equity may limit growth potential. FB Financial Corporation (FBK) strategically manages this balance to optimize financial performance and shareholder value.

FB Financial Corporation (FBK) Liquidity and Solvency

Liquidity and solvency are critical indicators of a financial institution's ability to meet its short-term and long-term obligations. For investors in FB Financial Corporation (FBK), assessing these metrics provides insights into the company’s financial stability and risk profile.

Current and Quick Ratios: These ratios measure a company's ability to cover its short-term liabilities with its short-term assets. As of the fiscal year 2024, FB Financial Corporation's liquidity positions can be evaluated using these key metrics:

• Current Ratio: This is calculated by dividing current assets by current liabilities. A ratio above 1 indicates that the company has more current assets than liabilities.
• Quick Ratio: Also known as the acid-test ratio, it excludes inventory from current assets to provide a more conservative measure of liquidity.

Analyzing these ratios over time can reveal trends in FBK's liquidity management. For instance, a consistently high current and quick ratio suggests strong liquidity, while a declining ratio may indicate potential challenges in meeting short-term obligations.

Analysis of Working Capital Trends: Working capital, defined as current assets minus current liabilities, is a fundamental measure of a company's operational liquidity. Monitoring trends in FBK's working capital provides insights into its ability to finance day-to-day operations. Factors influencing working capital include changes in inventory levels, accounts receivable, and accounts payable.

Cash Flow Statements Overview: The cash flow statement provides a comprehensive view of all cash inflows and outflows, categorized into operating, investing, and financing activities. Examining the trends in these categories can reveal valuable information about FBK's financial health:

• Operating Cash Flow: This reflects the cash generated from the company's core business operations. A positive and stable operating cash flow is generally a sign of financial health.
• Investing Cash Flow: This includes cash flows related to the purchase and sale of long-term assets, such as property, plant, and equipment (PP&E).
• Financing Cash Flow: This involves cash flows related to debt, equity, and dividends. Monitoring this section can provide insights into how FBK is funding its operations and returning value to shareholders.

Potential Liquidity Concerns or Strengths: Evaluating FB Financial Corporation's financial statements may reveal potential liquidity concerns or strengths. For example:

• Strengths: Consistently positive operating cash flow, high current and quick ratios, and effective working capital management.
• Concerns: Declining cash reserves, increasing debt levels, and significant capital expenditures could strain liquidity.

Understanding these aspects of liquidity and solvency is crucial for investors. For more insights into FB Financial Corporation, check out: Exploring FB Financial Corporation (FBK) Investor Profile: Who’s Buying and Why?

FB Financial Corporation (FBK) Valuation Analysis

Determining whether FB Financial Corporation (FBK) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance analysis, dividend information, and analyst ratings. Let's delve into these aspects to provide a clearer picture for investors. You can also check out more insights on Breaking Down FB Financial Corporation (FBK) Financial Health: Key Insights for Investors.

To assess FB Financial Corporation (FBK)’s valuation, several key ratios are essential:

• Price-to-Earnings (P/E) Ratio: This ratio indicates how much investors are willing to pay for each dollar of FBK’s earnings. A higher P/E ratio might suggest overvaluation, while a lower one could indicate undervaluation, relative to industry peers or FBK’s historical average.
• Price-to-Book (P/B) Ratio: The P/B ratio compares FBK’s market capitalization to its book value of equity. It can help determine if the stock price is reasonable compared to the company's net asset value.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio compares FBK’s enterprise value (total market value plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). It provides a more comprehensive valuation measure, especially useful for comparing companies with different capital structures.

Analyzing FB Financial Corporation’s stock price trends over the past year (or longer) offers insights into market sentiment and investor confidence. Key points to consider include:

• Stock Price Appreciation or Depreciation: Significant price increases may suggest growing investor optimism, while declines could indicate concerns about the company’s future performance.
• Volatility: High volatility might reflect uncertainty or speculative trading activity, whereas stable price movements could indicate steady investor confidence.
• Comparison to Market Indices: Evaluating FBK’s stock performance relative to benchmarks like the S&P 500 or relevant financial sector indices helps gauge whether the company is outperforming or underperforming the broader market.

If FB Financial Corporation (FBK) distributes dividends, examining the dividend yield and payout ratios is crucial for valuation:

• Dividend Yield: This is the annual dividend payment per share, divided by the stock price. A higher dividend yield can make the stock more attractive to income-seeking investors.
• Payout Ratio: The payout ratio represents the percentage of earnings paid out as dividends. A lower payout ratio suggests the company has more room to increase dividends in the future, while a high ratio might indicate limited growth potential for dividend payments.

Here's an example of how dividend yield and payout ratio can be presented:

It's essential to consider analyst consensus on FB Financial Corporation (FBK)’s stock valuation. This involves assessing ratings from various financial analysts, typically categorized as:

• Buy: Indicates that analysts believe the stock is undervalued and has potential for price appreciation.
• Hold: Suggests that the stock is fairly valued, and investors should maintain their current positions.
• Sell: Implies that the stock is overvalued and investors should consider selling their shares.

The overall consensus, along with price targets set by analysts, can provide a comprehensive view of market expectations for FB Financial Corporation (FBK)’s future performance and valuation.

FB Financial Corporation (FBK) Risk Factors

FB Financial Corporation (FBK) faces a variety of internal and external risks that could significantly impact its financial health. These risks span industry competition, regulatory changes, market conditions, and specific operational and strategic challenges.

Here's a breakdown of key risk areas:

• Industry Competition: The financial services industry is intensely competitive. FBK competes with commercial banks, savings banks, credit unions, non-bank financial services companies, online mortgage providers, internet banks, and other financial institutions. Many competitors, especially national and regional banks, possess greater resources for growth and technological investments. Community banks with strong local ties also pose a competitive threat. Increased competition puts pressure on loan and deposit pricing, potentially affecting FBK's financial results.
• Regulatory Trends and Changes in Laws: FBK is subject to extensive and evolving regulations and supervision. Heightened supervisory expectations in areas like consumer compliance, Bank Secrecy Act, anti-money laundering compliance, risk management, and internal audit lead to increased compliance costs. Additional expenses may arise from hiring more compliance, risk management, and audit personnel, or from professional fees for advisors and consultants.
• Credit Risks: FBK faces credit risks associated with its loan portfolios, particularly in commercial real estate, commercial and industrial, and construction loans, due to concentrations in these categories.

In its recent filings, FB Financial Corporation (FBK) reported a $12.0 million provision for credit losses for the year ended December 31, 2024, compared to $2.5 million for the year ended December 31, 2023. The 2024 provision included $14.7 million for credit losses on loans and a $2.7 million reversal of credit losses on unfunded commitments. This increase reflects changes in the overall loan portfolio, including growth and composition shifts, increased net charge-offs, and a slight deterioration in economic forecasts.

The evaluations considered the impact of the current economic outlook, including unemployment and gross domestic product, as well as macroeconomic events like supply chain concerns and global conflicts.

FBK's nonperforming loans HFI as a percentage of total loans HFI decreased to 0.87% as of the end of the fourth quarter of 2024, compared to 0.96% at the previous quarter-end and 0.65% at the end of the fourth quarter of 2023. Nonperforming assets as a percentage of total assets decreased to 0.93% as of the end of the fourth quarter of 2024, compared to 0.99% at the end of the prior quarter and 0.69% as of the end of the fourth quarter of 2023.

The company had an allowance for credit losses on loans HFI as of the end of the fourth quarter of 2024 of $151.9 million, representing 1.58% of loans HFI compared to $156.3 million, or 1.65% of loans HFI as of September 30, 2024. The Company had net charge-offs of $11.3 million in the fourth quarter of 2024, representing annualized net charge-offs of 0.47% of average loans HFI, which compares to annualized net charge-offs of 0.03% in the prior quarter and annualized net recoveries of 0.04% in the fourth quarter of 2023.

For further insights into FB Financial Corporation's mission, vision, and core values, you can explore: Mission Statement, Vision, & Core Values of FB Financial Corporation (FBK).

FB Financial Corporation (FBK) Growth Opportunities

FB Financial Corporation (FBK) is focusing on profitable growth opportunities within its footprint, encompassing both high-growth metropolitan markets and stable community markets. FB Financial can strategically deploy its capital across its markets to capitalize on opportunities with the greatest certainty of profitable growth and the highest returns.

Here's an analysis of key growth drivers, future projections, strategic initiatives, and competitive advantages:

• Key Growth Drivers:
• Expansion into attractive metropolitan markets including Atlanta, Birmingham, and Huntsville.
• Focusing on specialized banking and mortgage services.
• Leveraging local market knowledge and relationships to deliver timely solutions.
• Maintaining a community banking approach with personalized, relationship-based service.

FB Financial's President and CEO, Christopher T. Holmes, leads a talented management team executing the company's operating model.

FB Financial differentiates itself through a balanced approach emphasizing personalized customer service, comprehensive product offerings, and a deep understanding of the local economic environments in which it operates.

FB Financial leverages local talent with strong community ties and local authority, giving them a competitive advantage over larger competitors.

Mergers and Acquisitions:

• FB Financial's $381 million acquisition of Southern States Bancshares, Inc. expands FBK's geographic footprint in high-growth southeastern markets.
• The all-stock transaction will grow FB Financial's balance sheet by adding $2.8 billion in assets, $2.2 billion in loans, and $2.4 billion in deposits.
• The merger with Southern States is expected to close in Q3/Q4 2025.

Financial Performance and Projections:

• FB Financial reported strong Q1 2025 financial results with net income of $39.4 million, or $0.84 per diluted share.
• The company's loan portfolio grew to $9.77 billion, a 7.14% annualized increase from the previous quarter.
• Net interest margin improved to 3.55% from 3.50% in the previous quarter.
• Total deposits remained stable at $11.20 billion.

Simply Wall St forecasts FB Financial to grow earnings and revenue by 37.4% and 23.8% per annum respectively, while EPS is expected to grow by 28.6% per annum.

Strategic Initiatives and Partnerships:

• FB Financial is expanding its market presence in Alabama and Georgia through the merger with Southern States.
• FB Financial maintains strategic partnerships with regional banking networks to expand market reach.
• The company has established technological partnerships to enhance digital banking capabilities, investing $3.2 million in fintech collaboration and integration in 2023.

Competitive Advantages:

• FirstBank's local banking model places decision-makers close to the client.
• FB Financial's operating model is executed by a talented management team.
• The company focuses on relationship deposits while reducing funding costs.
• FB Financial has a strong capital and liquidity position with substantial loan loss reserves.

FB Financial's strategic presence in the southeastern U.S. contributes to its growth prospects and favorable outlook.

Potential Challenges:

• Economic uncertainty and market volatility pose challenges.
• Noninterest expense increased to $79.2 million, resulting in a higher core efficiency ratio of 59.9% compared to the previous quarter.
• Charge-offs were higher than historical levels, with an annualized net charge-off rate of 0.14%, driven by a specific C&I credit.

To delve deeper into FB Financial Corporation's financial health, consider reading: Breaking Down FB Financial Corporation (FBK) Financial Health: Key Insights for Investors