Breaking Down S&T Bancorp, Inc. (STBA) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments in regional banks? Wondering how S&T Bancorp, Inc. (STBA) is performing? In 2024, S&T Bancorp reported a net income of $131.3 million, with earnings per diluted share (EPS) at $3.41. How do these figures stack up against previous years, and what are the key indicators of their financial health? Dive in to explore the critical insights that can help you make informed decisions about STBA.

S&T Bancorp, Inc. (STBA) Revenue Analysis

Analyzing S&T Bancorp, Inc.'s (STBA) revenue streams involves examining where the company's money comes from, how these sources have changed over time, and the relative importance of each segment. Understanding these aspects can provide valuable insights into the company's financial health and future prospects. For additional context, you might find information about their strategic direction in: Mission Statement, Vision, & Core Values of S&T Bancorp, Inc. (STBA).

A breakdown of S&T Bancorp's primary revenue sources typically includes:

• Net Interest Income: The difference between the revenue generated from interest-bearing assets (like loans) and the expense of interest paid on liabilities (like deposits).
• Non-Interest Income: Revenue from fees, service charges, and other sources not directly related to interest. This can include things like wealth management fees, brokerage services, and deposit account fees.

Looking at the year-over-year revenue growth rate provides insight into the bank's performance. Examining historical trends—whether the revenue is consistently increasing, decreasing, or fluctuating—can reveal the stability and growth potential of the company.

Here's a general approach to analyzing revenue streams:

1. Net Interest Income:

Net interest income is crucial for banks. It's influenced by factors like interest rate spreads and the volume of loans and deposits.

• Trends: Look for trends in net interest margin (NIM), which reflects the efficiency of earning interest income.
• Influences: Consider how changes in interest rates and the overall economic environment might affect NIM.

2. Non-Interest Income:

Non-interest income can diversify a bank's revenue and reduce reliance on interest rates.

• Components: Identify the main components of non-interest income, such as service charges, wealth management fees, and mortgage banking income.
• Stability: Assess the stability and predictability of these income streams.

3. Segment Contribution:

Understanding how different business segments contribute to overall revenue is essential for a comprehensive analysis.

• Key Segments: Determine the key business segments (e.g., commercial lending, retail banking) and their respective contributions to revenue.
• Growth Rates: Compare the growth rates of different segments to identify areas of strength and weakness.

4. Significant Changes:

Analyzing any significant changes in revenue streams helps to understand strategic shifts or market impacts.

• Identify Shifts: Look for any notable shifts in revenue composition, such as a growing reliance on fee income or a decline in net interest income.
• Explain Factors: Analyze the factors driving these changes, such as regulatory changes, market conditions, or strategic initiatives.

For S&T Bancorp, a detailed analysis would involve examining their specific financial reports and investor presentations to extract the relevant data and trends. Keep an eye on how their revenue mix evolves and what strategies they are implementing to drive growth and maintain profitability.

S&T Bancorp, Inc. (STBA) Profitability Metrics

Understanding S&T Bancorp, Inc. (STBA)'s profitability is crucial for investors looking to assess the company's financial health and potential for growth. Profitability metrics provide insights into how efficiently STBA generates earnings relative to its revenue, assets, and equity. By examining gross profit, operating profit, and net profit margins, investors can gain a comprehensive view of STBA's ability to manage costs and generate profits.

Here's a detailed look into S&T Bancorp, Inc.'s profitability:

Analyzing S&T Bancorp, Inc.'s profitability involves several key metrics:

• Gross Profit Margin: This ratio indicates the percentage of revenue remaining after deducting the cost of goods sold (COGS). It reflects the company's efficiency in managing production costs.
• Operating Profit Margin: This ratio measures the percentage of revenue remaining after deducting both COGS and operating expenses. It indicates how well the company manages its operational costs.
• Net Profit Margin: This ratio represents the percentage of revenue that translates into net income. It is a comprehensive measure of overall profitability, taking into account all expenses, including taxes and interest.

To effectively evaluate STBA's financial performance, it is essential to analyze these metrics over time and compare them against industry averages. This approach provides valuable insights into the company's ability to sustain and improve its profitability.

Recent data regarding S&T Bancorp, Inc.'s profitability can be found in their financial reports. For instance, examining the 2024 fiscal year results would offer a clear picture of their current profitability margins.

Operational efficiency is a critical component of S&T Bancorp, Inc.'s profitability. Effective cost management and favorable gross margin trends can significantly impact the bottom line. Investors should closely monitor these aspects to assess the company's ability to maintain and enhance its profitability.

For additional insights into S&T Bancorp, Inc. (STBA), consider exploring their investor profile: Exploring S&T Bancorp, Inc. (STBA) Investor Profile: Who’s Buying and Why?

S&T Bancorp, Inc. (STBA) Debt vs. Equity Structure

Understanding how S&T Bancorp, Inc. (STBA) 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 further insights into the company's strategic direction, see: Mission Statement, Vision, & Core Values of S&T Bancorp, Inc. (STBA).

As of the fiscal year 2024, S&T Bancorp, Inc. (STBA) reported a mix of short-term and long-term debt. While specific figures can fluctuate, it's important to consider both types of debt to get a complete picture of the company's financial obligations. Short-term debt typically includes obligations due within a year, while long-term debt consists of liabilities extending beyond a year. Detailed figures would be available in the company's 2024 financial statements.

The debt-to-equity ratio is a key metric for evaluating a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. A higher ratio suggests that the company relies more on debt, which can amplify both gains and losses. A lower ratio indicates a more conservative approach. Comparing S&T Bancorp, Inc. (STBA)'s debt-to-equity ratio to industry standards provides valuable context. Here's a general overview of what different levels might suggest:

• Low Ratio (e.g., below 1.0): Suggests lower financial risk and reliance on equity.
• Moderate Ratio (e.g., 1.0 to 2.0): Indicates a balanced approach between debt and equity.
• High Ratio (e.g., above 2.0): May signal higher financial risk, with greater reliance on debt.

Investors should look for trends in the debt-to-equity ratio over time to understand how S&T Bancorp, Inc. (STBA)'s leverage is changing. Keep in mind that what constitutes an 'ideal' ratio can vary by industry.

Monitoring S&T Bancorp, Inc. (STBA)'s recent debt issuances, credit ratings, and any refinancing activities provides insight into its financial strategy and health. Recent activities might include:

• New Debt Issuances: Raising capital through the issuance of bonds or other debt instruments.
• Credit Ratings: Assessments from agencies like Moody's or Standard & Poor's, reflecting creditworthiness.
• Refinancing: Replacing existing debt with new debt, often to secure better terms or lower interest rates.

These actions can impact the company's financial flexibility and cost of capital.

S&T Bancorp, Inc. (STBA) must strategically balance debt financing and equity funding. Debt can provide a cost-effective way to grow, especially when interest rates are low, but it also increases financial risk. Equity, on the other hand, doesn't require repayment but can dilute ownership. The company's approach to this balance impacts its financial stability and growth potential. Here's a simplified illustration of how debt and equity might be balanced:

By analyzing these factors, investors can gain a clearer understanding of S&T Bancorp, Inc. (STBA)'s financial strategy and its implications for future performance.

S&T Bancorp, Inc. (STBA) Liquidity and Solvency

Liquidity and solvency are vital indicators of a financial institution's ability to meet its short-term obligations and long-term financial stability. For S&T Bancorp, Inc. (STBA), analyzing these metrics provides insights into its operational efficiency and risk management.

Here's an overview:

• Current and Quick Ratios: These ratios assess STBA's ability to cover its short-term liabilities with its short-term assets. A current ratio of around 1.0x or higher typically indicates good liquidity, while the quick ratio offers a more conservative view by excluding inventory.
• Analysis of Working Capital Trends: Monitoring STBA's working capital (current assets minus current liabilities) over time can reveal trends in its operational efficiency. Consistent growth in working capital suggests effective management of short-term assets and liabilities.
• Cash Flow Statements Overview: A review of STBA's cash flow statements provides insights into its cash generation and usage. Key areas to examine include:
  • Operating Cash Flow: Cash generated from STBA's core business operations.
  • Investing Cash Flow: Cash flow related to the purchase and sale of long-term assets.
  • Financing Cash Flow: Cash flow related to debt, equity, and dividends.
• Potential Liquidity Concerns or Strengths: Evaluating STBA's liquidity position involves identifying any potential risks, such as a decline in cash reserves or an increase in short-term debt. Conversely, strengths may include a strong cash position or effective working capital management.

For additional background, you might find this resource helpful: Breaking Down S&T Bancorp, Inc. (STBA) Financial Health: Key Insights for Investors

S&T Bancorp, Inc. (STBA) Valuation Analysis

Determining whether S&T Bancorp, Inc. (STBA) is overvalued or undervalued requires a multifaceted approach, considering key financial ratios, stock performance, and analyst sentiment. Several metrics offer insights into STBA's current market valuation.

Price-to-Earnings (P/E) Ratio: The P/E ratio compares a company's stock price to its earnings per share, indicating how much investors are willing to pay for each dollar of earnings. For S&T Bancorp, Inc., recent data shows a P/E ratio that needs to be compared against industry averages and historical data to determine if it's relatively high or low. A lower P/E ratio might suggest undervaluation, while a higher ratio could indicate overvaluation. Keep in mind that as of December 31, 2024, the Price/Earnings Ratio (TTM) was 9.31.

Price-to-Book (P/B) Ratio: The P/B ratio measures a company's market capitalization relative to its book value of equity. It can help investors determine whether the stock is trading at a discount or premium to its net asset value. As of December 31, 2024, the Price/Book ratio was 0.92. A P/B ratio below 1 could suggest the stock is undervalued.

Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: The EV/EBITDA ratio compares a company's enterprise value (total market value plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). This ratio provides a more comprehensive valuation measure than the P/E ratio because it takes into account a company's debt and capital expenditures. The most recent data available, as of December 31, 2024, indicates an EV/EBITDA ratio of 6.72. This ratio can be indicative of relative value when compared to industry peers.

Stock Price Trends: Analyzing S&T Bancorp, Inc.'s stock price trends over the past 12 months (or longer) provides context on market sentiment and potential growth trajectories. Recent data indicates:

• The stock has demonstrated a 50 day moving average of $26.87.
• The stock has demonstrated a 200 day moving average of $26.18.

Dividend Yield and Payout Ratios: For income-focused investors, dividend yield and payout ratios are crucial. S&T Bancorp, Inc. has consistently provided dividends, underscoring its financial stability. Key figures include:

• Annualized dividend of $1.28 per share.
• A dividend yield of approximately 4.76%.
• A payout ratio of 44.46%, suggesting the dividend is sustainable and has room for potential increases.

Analyst Consensus: Examining analyst ratings and price targets offers additional insights into market expectations. Recent analyst ratings can provide a snapshot of whether experts recommend buying, holding, or selling the stock. Keep an eye on any upgrades or downgrades, as well as changes to price targets, as these can influence investor sentiment.

Here's a summary table of key valuation metrics for S&T Bancorp, Inc. as of December 31, 2024:

For further insights into the investors of S&T Bancorp, Inc., check out: Exploring S&T Bancorp, Inc. (STBA) Investor Profile: Who’s Buying and Why?

S&T Bancorp, Inc. (STBA) Risk Factors

S&T Bancorp, Inc. (STBA) faces a variety of internal and external risks that could significantly impact its financial health. These risks span industry competition, regulatory changes, and broader market conditions, all of which require careful monitoring and proactive management.

Industry Competition: The financial services industry is intensely competitive. S&T Bancorp, Inc. (STBA) competes with other community banks, regional banks, and larger national institutions, as well as non-bank financial service providers. Increased competition can lead to pressure on interest rates, reduced loan volumes, and higher costs for attracting and retaining deposits. Maintaining a competitive edge requires continuous innovation and adaptation to changing customer preferences.

Regulatory Changes: Banks are subject to extensive regulation at both the federal and state levels. Changes in regulations can impact capital requirements, lending practices, and compliance costs. For example, changes to the Dodd-Frank Act or other financial regulations can create new challenges for S&T Bancorp, Inc. (STBA), requiring adjustments to its business model and increased investment in compliance infrastructure.

Market Conditions: Economic downturns, changes in interest rates, and other market fluctuations can significantly affect S&T Bancorp, Inc. (STBA)'s performance. Rising interest rates can reduce demand for loans and increase the cost of funds, while a recession can lead to higher loan losses and reduced profitability. Effective risk management requires careful monitoring of economic indicators and proactive adjustments to lending and investment strategies.

In addition to these broad categories, specific operational, financial, and strategic risks are often highlighted in S&T Bancorp, Inc. (STBA)'s earnings reports and filings. These may include:

• Credit Risk: The risk that borrowers will default on their loans is a constant concern for any bank. S&T Bancorp, Inc. (STBA) must carefully assess the creditworthiness of its borrowers and manage its loan portfolio to minimize potential losses.
• Interest Rate Risk: Changes in interest rates can affect a bank's net interest margin, which is the difference between the interest income it earns on loans and the interest it pays on deposits. S&T Bancorp, Inc. (STBA) must manage its assets and liabilities to mitigate the impact of interest rate fluctuations.
• Liquidity Risk: Banks must maintain sufficient liquidity to meet the demands of their depositors and borrowers. Unexpected withdrawals or a sudden increase in loan demand can strain a bank's liquidity position. S&T Bancorp, Inc. (STBA) must carefully manage its cash flow and maintain access to funding sources to ensure it can meet its obligations.

Mitigation strategies or plans are crucial for managing these risks. S&T Bancorp, Inc. (STBA) may employ various techniques, such as:

• Diversification: Diversifying its loan portfolio across different industries and geographic regions can reduce the impact of any single borrower or economic event.
• Hedging: Using financial instruments to hedge against interest rate risk can protect the bank's net interest margin from fluctuations.
• Stress Testing: Conducting regular stress tests to assess the bank's ability to withstand adverse economic conditions can help identify vulnerabilities and inform risk management strategies.

Effective risk management is essential for S&T Bancorp, Inc. (STBA) to maintain its financial health and deliver long-term value to its shareholders. By proactively addressing these risks, S&T Bancorp, Inc. (STBA) can navigate the challenges of the financial services industry and capitalize on opportunities for growth.

Learn more about S&T Bancorp, Inc. (STBA) investor profile: Exploring S&T Bancorp, Inc. (STBA) Investor Profile: Who’s Buying and Why?

S&T Bancorp, Inc. (STBA) Growth Opportunities

Several factors indicate potential future growth for S&T Bancorp, Inc. (STBA). These include strategic initiatives, market conditions, and the company's financial performance.

Key growth drivers for S&T Bancorp, Inc. (STBA) include:

• Strategic Initiatives: S&T Bancorp focuses on customer-forward initiatives and employee engagement.
• Operational Efficiency: The company emphasizes cost-cutting measures and operational efficiencies to bolster financial health.
• Digital Expansion: S&T Bancorp is expanding its digital banking services to attract a broader customer base.
• Market Expansion: S&T Bancorp operates in key markets such as Western and Eastern Pennsylvania, Northeast and Central Ohio, and Upstate New York. In 2019, S&T Bank expanded its presence in the Ohio markets by opening retail offices in Hilliard and Cuyahoga Falls and opened a second New York loan production office in Buffalo.

Future revenue growth projections and earnings estimates include:

• Revenue Growth: Annual revenue is expected to grow at 4.3% per year.
• EPS Growth: Earnings per share are expected to decline by 1.9% per annum.
• Analyst Estimates: For 2025, the consensus is for revenues of $396.8 million, a 3.4% increase over the past 12 months.

Strategic initiatives and partnerships that may drive future growth:

• Acquisitions: S&T Bancorp has a history of expanding through acquisitions. In 2002, it completed the merger of Peoples Financial Corporation. In March 2016, S&T Bancorp acquired Integrity Bank in Harrisburg.
• Leadership Focus: CEO Chris McComish focuses on customer-forward initiatives and employee engagement.
• Digital and Business Technology: Michael Golden, as Executive Vice President and Chief Operating Officer, brings experience in digital and business technology.

S&T Bancorp, Inc. (STBA) has several competitive advantages that position it for growth:

• Customer Service: S&T Bancorp sees customer service as a competitive advantage.
• Strong Capital Position: S&T Bancorp maintains a strong regulatory capital position, with all capital ratios above federal thresholds.
• Top Workplace Recognition: Being recognized as a top workplace can lead to higher employee retention, increased productivity, and better customer service.

S&T Bancorp's recent financial performance includes:

• Net Income: Net income for 2024 was $131.3 million, compared to $144.8 million in 2023.
• EPS: Earnings per diluted share (EPS) was $3.41 for 2024, compared to $3.74 in 2023.
• Total Deposits: Total deposits increased by $261.3 million compared to 2023.
• Portfolio Loans: Total portfolio loans increased by $89.6 million, or 1.17%, compared to December 31, 2023.
• Revenue: In 2024, S&T Bancorp had annual revenue of $383.76 million, down 0.87% from the previous year.

Analysts' perspectives on S&T Bancorp, Inc. (STBA) include:

• Revenue Estimates: Analysts estimate revenue of $96.4 million for the next quarter (June 2025) and $397 million for the current year (2025).
• Stock Price Forecast: Analysts are in good agreement that the stock price will rise by 21%.

While S&T Bancorp has shown strengths, there are also challenges to consider:

• Earnings Decline: Earnings are forecast to decline by an average of 1.8% per year for the next 3 years.
• Net Interest Income: Net interest income decreased by $1.2 million in Q4 2024 compared to Q3 2024.

To gain more insights into S&T Bancorp, Inc. (STBA) financial health, refer to: Breaking Down S&T Bancorp, Inc. (STBA) Financial Health: Key Insights for Investors