Breaking Down Red River Bancshares, Inc. (RRBI) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments and looking for a community bank that's showing consistent performance? Have you been curious about how shifts in net interest margin and strategic stock repurchases can impact a company's bottom line? In 2024, Red River Bancshares, Inc. (RRBI) reported a net income of $34.2 million, or $4.95 earnings per share, with a return on assets of 1.11% and a return on equity of 11.02%. Delve into this analysis to discover key insights about RRBI's financial health, from revenue trends to balance sheet strength, and understand what these indicators suggest for investors.

Red River Bancshares, Inc. (RRBI) Revenue Analysis

Understanding the revenue streams of Red River Bancshares, Inc. (RRBI) is crucial for investors seeking to assess the company's financial health and stability. A detailed breakdown reveals how the bank generates its income, its growth trajectory, and the significance of different business segments.

Red River Bancshares, Inc. reported total interest income of $213.4 million for the year 2023, compared to $132.3 million for the year 2022. The net interest income increased to $164.4 million for 2023 from $108.4 million in 2022. This substantial increase reflects the bank's ability to generate more income from its lending and investment activities.

Here's a breakdown of primary revenue sources:

• Interest Income: This includes income from loans, investment securities, and other interest-bearing assets.
• Service Charges and Fees: Revenue generated from various customer services and fees.
• Other Income: Income from sources other than interest and fees.

Year-over-year revenue growth rate:

• The total interest income saw a significant increase from $132.3 million in 2022 to $213.4 million in 2023.
• Net interest income also increased substantially from $108.4 million in 2022 to $164.4 million in 2023.

Contribution of different business segments to overall revenue:

The primary contribution to Red River Bancshares, Inc.'s revenue comes from its net interest income, which constitutes a significant portion of the total revenue. The increase in net interest income indicates a strong performance in the bank's core lending activities.

Here is a table summarizing the key changes in revenue streams:

Analysis of any significant changes in revenue streams:

The substantial increase in both total interest income and net interest income from 2022 to 2023 indicates a positive trend in Red River Bancshares, Inc.'s financial performance. This growth can be attributed to effective management of interest-bearing assets and liabilities, as well as favorable market conditions.

To gain more insight into the values that drive Red River Bancshares, Inc., explore: Mission Statement, Vision, & Core Values of Red River Bancshares, Inc. (RRBI).

Red River Bancshares, Inc. (RRBI) Profitability Metrics

Understanding the profitability of Red River Bancshares, Inc. (RRBI) is crucial for investors. Profitability metrics provide insights into how efficiently the company generates profits relative to its revenue, assets, and equity. Let's delve into the key profitability indicators for RRBI.

Here's a detailed look into Red River Bancshares, Inc.'s profitability:

• Gross Profit: Gross Profit (ttm) is $108.68 million.
• Operating Income: The operating income for the third quarter of 2024 was $652 million, a 6.1% organic increase.
• Net Income:
  • For the third quarter of 2024, net income stood at $8.8 million, or $1.27 per diluted common share.
  • Full year 2024 net income was $34.2 million, or $4.95 EPS.
  • Q4 2024 net income reached $9.3 million, or $1.37 per diluted share.

Here's a table summarizing RRBI's key profitability ratios based on available 2024 data:

Red River Bancshares' Net Interest Margin (NIM) saw improvements throughout 2024:

• The net interest margin for the third quarter of 2024 was 2.93%.
• For the full year 2024, the net interest margin was 2.96%, up from 2.91% in FY 2023.
• In the fourth quarter of 2024, the net interest margin improved to 3.09% from 2.98% in the previous quarter.

Operational efficiency is evident in Red River Bancshares' cost management and gross margin trends. The cost-to-income ratio for the full year 2024 was 60.3%, which is up from 59.4% in FY 2023 Exploring Red River Bancshares, Inc. (RRBI) Investor Profile: Who’s Buying and Why?.

The gross profit margin for the 2024 fiscal year is reported as 100%.

It's also worth noting that RRBI's management is actively enhancing shareholder value through stock repurchases. In 2024, the company's stock repurchase program positively impacted EPS by $0.14.

Red River Bancshares, Inc. (RRBI) Debt vs. Equity Structure

Understanding how Red River Bancshares, Inc. (RRBI) finances its operations and growth is crucial for investors. This involves looking at the company's debt levels, its debt-to-equity ratio compared to industry standards, and any recent financing activities.

As of December 31, 2024, Red River Bancshares Inc. reported the following:

• Liquid assets (cash and cash equivalents) were at $269.0 million, making the liquid assets to total assets ratio at 8.54%.
• The company has access to $1.62 billion from other liquidity sources.
• Loans HFI (held for investment) stood at $2.08 billion.
• Total securities amounted to $684.9 million, representing 21.7% of total assets.
• The loans HFI to deposits ratio was 73.97%.

Red River Bancshares Inc. maintains a strong financial position with a focus on balancing debt and equity. As of December 2024, the company's financial strength is highlighted by a cash-to-debt ratio of 93.92, indicating it could cover its debt obligations using available cash. The debt-to-equity ratio is less than 0.01, reflecting a conservative approach to leverage.

Here's a look at some key solvency ratios for RRBI:

Red River Bancshares, Inc. has no borrowings, brokered deposits, or internet-sourced deposits. The company did not have any outstanding long-term debt as of December 31, 2023.

For more insights into the company's investors, explore Exploring Red River Bancshares, Inc. (RRBI) Investor Profile: Who’s Buying and Why?.

Red River Bancshares, Inc. (RRBI) Liquidity and Solvency

Assessing the liquidity of Red River Bancshares, Inc. (RRBI) involves analyzing its ability to meet short-term obligations. Key metrics include the current and quick ratios, working capital trends, and cash flow statement analysis.

The current ratio, calculated by dividing current assets by current liabilities, provides insights into RRBI's ability to cover its short-term liabilities with its short-term assets. A higher current ratio generally indicates better liquidity. For example, if RRBI's current assets were $200 million and current liabilities were $100 million, the current ratio would be 2.0.

The quick ratio, also known as the acid-test ratio, is a more conservative measure of liquidity. It excludes inventories from current assets, as inventories may not be easily converted to cash. RRBI's quick ratio can be calculated by subtracting inventories from current assets and dividing the result by current liabilities. For instance, if RRBI's current assets (excluding inventories) were $150 million and current liabilities were $100 million, the quick ratio would be 1.5.

Analyzing working capital trends involves monitoring the difference between RRBI's current assets and current liabilities over time. Consistent growth in working capital suggests improved liquidity management. Declining working capital may signal potential liquidity issues. For example, tracking the change in working capital from $50 million to $60 million over a year indicates a positive trend.

An overview of RRBI's cash flow statements provides insights into its cash flow trends from operating, investing, and financing activities. Positive operating cash flow indicates that RRBI is generating sufficient cash from its core business operations to meet its obligations. Trends in investing and financing cash flows can reveal RRBI's capital expenditure plans and financing strategies. For example, consistent positive cash flow from operations, coupled with strategic investments, can strengthen RRBI's financial position.

Potential liquidity concerns may arise if RRBI experiences a decline in its current or quick ratios, negative working capital trends, or negative operating cash flow. Conversely, strengths in liquidity positions may be evident through high current and quick ratios, positive working capital trends, and strong operating cash flow. Monitoring these indicators helps investors assess RRBI's ability to manage its short-term financial obligations effectively.

Here's an example of how these ratios might look in a comparative table:

Understanding RRBI's mission, vision, and core values can provide additional context for its financial strategies and long-term sustainability. Find more details at: Mission Statement, Vision, & Core Values of Red River Bancshares, Inc. (RRBI).

Red River Bancshares, Inc. (RRBI) Valuation Analysis

Assessing whether Red River Bancshares, Inc. (RRBI) is overvalued or undervalued involves analyzing several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield and payout ratios, and analyst consensus.

Currently, up-to-date, real-time data for these specific valuation metrics as of April 2025 is not available in the search results. Therefore, a comprehensive valuation analysis requires direct access to financial data services or recent financial reports.

To determine if Red River Bancshares, Inc. (RRBI) is overvalued or undervalued, consider the following:

• Price-to-Earnings (P/E) Ratio: Compare RRBI's P/E ratio to the industry average and its historical P/E ratio. A higher P/E ratio might suggest overvaluation if it's significantly above its peers or historical average.
• Price-to-Book (P/B) Ratio: This ratio compares the company's market capitalization to its book value. A lower P/B ratio could indicate undervaluation, while a higher ratio might suggest overvaluation.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio provides a more comprehensive valuation measure, especially useful for comparing companies with different capital structures. A lower EV/EBITDA ratio relative to peers could indicate undervaluation.

Here's a general guideline on how these metrics can be interpreted:

Analyzing stock price trends over the last 12 months (or longer) can provide insights into market sentiment and investor confidence. A consistent upward trend may reflect positive market perception, while a downward trend could indicate concerns about the company's performance or industry outlook.

If applicable, dividend yield and payout ratios are important for income-focused investors. A higher dividend yield can be attractive, but it's crucial to assess the sustainability of the dividend payout ratio. A payout ratio that is too high may not be sustainable in the long term.

Keep an eye on analyst consensus on the stock valuation (buy, hold, or sell). Analyst ratings can reflect the collective opinion of experts regarding the stock's potential. However, it's essential to consider that analyst ratings are not always accurate and should be used as one factor among many in the valuation process.

For further insights into Red River Bancshares, Inc. (RRBI) and its investors, check out: Exploring Red River Bancshares, Inc. (RRBI) Investor Profile: Who’s Buying and Why?

Red River Bancshares, Inc. (RRBI) Risk Factors

Red River Bancshares, Inc. (RRBI) faces a variety of internal and external risks that could impact its financial health. These risks span industry competition, regulatory changes, and broader market conditions. Understanding these factors is crucial for investors assessing the company's stability and future prospects.

Here's a breakdown of key risk areas:

• Industry Competition: The banking sector is highly competitive. RRBI competes with other community banks, regional banks, and larger national institutions. Increased competition can pressure RRBI's profit margins and ability to grow its loan portfolio.
• Regulatory Changes: Banks are subject to extensive regulations. Changes in laws and regulations can increase compliance costs, restrict certain business activities, and impact profitability. For example, changes in capital requirements or lending regulations could significantly affect RRBI's operations.
• Market Conditions: Economic downturns, changes in interest rates, and other market fluctuations can impact RRBI's financial performance. Rising interest rates can decrease demand for loans, while an economic recession can lead to increased loan defaults.

Operational, financial, and strategic risks are often highlighted in RRBI's earnings reports and filings. These can include:

• Credit Risk: The risk that borrowers will default on their loans. This is a primary risk for any bank, and effective credit risk management is essential.
• Interest Rate Risk: The risk that changes in interest rates will negatively impact earnings. Banks must manage the gap between the interest rates they earn on loans and the rates they pay on deposits.
• Liquidity Risk: The risk that a bank will not have enough cash to meet its obligations. Maintaining adequate liquidity is crucial for a bank's solvency.
• Operational Risk: The risk of loss resulting from inadequate or failed internal processes, people, and systems, or from external events. This includes risks like fraud, cyberattacks, and errors in processing transactions.

Mitigation strategies and plans are crucial for addressing these risks. While specific details may vary, common strategies include:

• Diversification: Diversifying the loan portfolio across different industries and geographic regions can reduce credit risk.
• Hedging: Using financial instruments to hedge against interest rate risk.
• Strong Risk Management Systems: Implementing robust systems and controls to monitor and manage risks.
• Compliance Programs: Maintaining comprehensive compliance programs to adhere to all applicable laws and regulations.

Understanding these risk factors and mitigation strategies is vital for investors looking to assess the overall financial health and stability of Red River Bancshares, Inc. (RRBI).

Learn more about RRBI: Exploring Red River Bancshares, Inc. (RRBI) Investor Profile: Who’s Buying and Why?

Red River Bancshares, Inc. (RRBI) Growth Opportunities

Red River Bancshares, Inc. (RRBI) is strategically positioned for future growth through several key drivers. These encompass organic expansion, strategic acquisitions, and a commitment to technological innovation. As of today, April 21, 2025, RRBI's growth strategy reflects a balanced approach to strengthening its market presence and enhancing shareholder value.

Here's a detailed look at the factors propelling RRBI's growth:

• Organic Expansion: RRBI is focused on expanding its footprint within existing markets. This includes opening new banking centers and enhancing its presence in key areas such as the Acadiana and New Orleans markets. For instance, in the fourth quarter of 2024, RRBI purchased property in Lafayette, Louisiana, to build a new banking center, marking its second location in the Acadiana market. Furthermore, in June 2024, RRBI inaugurated its second full-service banking center in New Orleans.
• Strategic Initiatives and Partnerships: RRBI is actively pursuing strategic initiatives to bolster its competitive edge. One such initiative is the partnership with Q2 Holdings, Inc. to modernize its digital banking platform. This collaboration aims to provide a seamless digital banking experience for both consumer and commercial customers, including a new small business commercial offering.
• Stock Repurchase Programs: RRBI has implemented stock repurchase programs to enhance shareholder value. In 2024, the company repurchased 327,085 shares of its common stock, which positively impacted earnings per share by $0.14. Moreover, the board of directors approved a renewal of the stock repurchase program for 2025, authorizing the purchase of up to $5.0 million of outstanding shares.
• Revenue Growth: Red River Bancshares has demonstrated consistent revenue growth over the years. In 2024, the company's annual revenue reached $108.68 million, representing a 1.74% increase. Additionally, the revenue for the quarter ending December 31, 2024, was $28.53 million, showing an 8.76% growth.
• Earnings Estimates: Wall Street anticipates a year-over-year increase in earnings for Red River Bancshares. The consensus EPS forecast for the quarter ended March 2025 is $1.29 per share, which is an 11.2% increase from the previous year. Revenues are expected to be $28.46 million, up 8.3% from the year-ago quarter.

Here is a table summarizing RRBI's key financial data:

RRBI's strategic focus on organic growth, technological innovation, and shareholder value enhancement positions it favorably for continued success in the regional banking sector. The company's strong capital levels and consistent financial performance underscore its stability and potential for future expansion.

To gain more insights into RRBI's investor profile, consider reading: Exploring Red River Bancshares, Inc. (RRBI) Investor Profile: Who’s Buying and Why?