Blue Foundry Bancorp (BLFY): SWOT Analysis [Nov-2025 Updated]

You're looking at Blue Foundry Bancorp (BLFY) and seeing a classic value puzzle: the bank's tangible book value (TBV) is strong at over $15 per share as of Q3 2025, but it's still reporting a net loss of $1.9 million. The market is defintely skeptical, pricing the stock at a steep discount, but there's a massive catalyst coming in 2026 when over $80 million in low-yield loans reprice. So, is this a deep-value opportunity management is aggressively buying back, or a waiting game that could turn sour? We need to map the near-term risks against that huge 2026 earnings potential.

Blue Foundry Bancorp (BLFY) - SWOT Analysis: Strengths

Tangible Book Value (TBV) per share exceeds $15 as of Q3 2025, showing strong underlying asset value.

You're looking for a margin of safety in a regional bank, and Blue Foundry Bancorp gives you a clear one with its tangible book value (TBV). TBV is essentially the liquidation value of the bank-what's left if you sell all the assets and pay off all the liabilities, excluding intangible assets like goodwill. As of September 30, 2025, the TBV per share stood at a strong $15.14.

This is a critical strength because the stock price has recently traded at a significant discount to this number. Management is defintely signaling confidence by buying back shares well below this value. It means for every dollar of the bank's core assets, you're paying substantially less, which creates a structural floor for the stock price as the bank works toward profitability.

Net Interest Margin (NIM) is expanding, hitting 2.34% in Q3 2025, a 52 basis point year-over-year gain.

The core engine of any bank is its Net Interest Margin (NIM)-the difference between what it earns on loans and what it pays on deposits. Blue Foundry Bancorp is successfully navigating the tough interest rate environment, a major win. In Q3 2025, their NIM hit 2.34%.

This isn't just a small tick up; it represents a structural improvement. Compared to Q3 2024, the NIM expanded by a whopping 52 basis points. This expansion is driven by two key factors: asset yields (what they earn on loans) are rising, and funding costs (what they pay on deposits) are starting to ease, showing better balance sheet management.

Management is aggressively repurchasing stock, buying 837,388 shares in Q3 2025, which boosts value for remaining holders.

Management is putting its money where its mouth is. Despite reporting a net loss for the quarter, the company is aggressively executing its share repurchase program because the stock trades so far below its TBV. In the third quarter of 2025 alone, Blue Foundry Bancorp repurchased 837,388 shares.

Here's the quick math: they bought back this stock at a weighted average price of approximately $9.09 per share. Buying back a dollar of tangible assets for about 60 cents is a phenomenal use of capital, immediately boosting the value for every remaining shareholder. It signals a deep belief that the current GAAP losses are temporary and the underlying value is sound.

Loan and deposit portfolios are growing, with Q3 2025 deposits up $77.1 million to $1.49 billion.

A healthy bank needs two things: strong demand for its loans and a stable, growing deposit base to fund them. Blue Foundry Bancorp delivered on both in Q3 2025. Total deposits grew by $77.1 million in the quarter. This growth brought total deposits to $1.49 billion as of September 30, 2025.

The loan portfolio also saw robust growth, increasing by $41.9 million to a total of $1.71 billion. The growth is strategically focused on higher-yielding assets like commercial real estate and consumer loans, which helps fuel the NIM expansion we just discussed. This is a disciplined, purposeful growth strategy.

This table summarizes the key financial strengths from the Q3 2025 report:

The focus is clearly on building a stronger, more profitable balance sheet:

• Increase asset yields on new loans.
• Lower cost of average interest-bearing liabilities.
• Shift loan mix to higher-yielding consumer and owner-occupied commercial real estate (CRE).

Blue Foundry Bancorp (BLFY) - SWOT Analysis: Weaknesses

The company remains unprofitable, reporting a net loss of $1.9 million in Q3 2025

Blue Foundry Bancorp continues to struggle with profitability, a core weakness that overshadows its operational improvements. For the third quarter of 2025, the company reported a net loss of approximately $1.9 million, which translates to a diluted loss per common share of $0.10. While this net loss is a slight improvement from the $2.0 million loss in the prior quarter, the persistent lack of positive earnings is a significant drag on shareholder returns and market sentiment. The nine-month net loss through September 30, 2025, totaled $6.52 million.

Weak financial health metrics, including a negative Return on Equity (ROE) of -2.84%

The bank's financial health metrics clearly signal inefficiency and a failure to generate returns from shareholder capital. The Return on Equity (ROE), a key measure of profitability relative to equity, was negative at -2.84% for the third quarter of 2025. This means the company is destroying, not creating, shareholder value. Furthermore, the bank's net margin for the quarter was also negative, standing at -9.82%. This operational weakness is compounded by a notable deterioration in asset quality, specifically the rise in non-performing loans (NPLs).

Here's the quick math on key profitability and asset quality metrics as of Q3 2025:

Stock trades at a significant discount to its tangible book value, signaling market doubt about achieving profitability

Investors are defintely pricing in the risk of continued losses, as evidenced by the deep discount of the stock price to its tangible book value (TBV). The tangible book value per share was strong at $15.14 as of September 30, 2025. However, with the stock trading around $8.08 in mid-November 2025, the Price-to-Tangible-Book Ratio is approximately 0.54. This means the market values the company at only 54 cents for every dollar of its net tangible assets. This persistent valuation gap is a clear sign of market skepticism regarding management's ability to convert asset value into sustained, positive earnings, which is the ultimate goal of a bank's business model.

Analyst consensus is a 'Reduce' or 'Sell' rating as of November 2025, with an average price target of only $10.00

Wall Street's collective view on Blue Foundry Bancorp is cautious, which is a major headwind for the stock price. The consensus analyst rating as of November 2025 is 'Reduce.' This is a step above a 'Strong Sell,' but still implies that analysts believe the stock will underperform the market or its sector peers. The average 12-month price target is a modest $10.00, which, while offering some theoretical upside from the current trading price, is still far below the tangible book value of $15.14. This low price target reinforces the market's lack of confidence in the near-term profitability story, despite the structural tailwinds from repricing low-yield loans in 2026.

• Consensus Rating: 'Reduce'
• Average Price Target: $10.00
• Current Stock Price (mid-Nov 2025): ~$8.08
• Tangible Book Value Per Share: $15.14

Blue Foundry Bancorp (BLFY) - SWOT Analysis: Opportunities

The core opportunity for Blue Foundry Bancorp is a structural, locked-in earnings catalyst that will significantly expand the net interest margin (NIM) starting in 2026. You are looking at a bank that is currently trading at a deep discount but has a clear, mathematical path to profitability driven by asset repricing and a successful strategic pivot.

A major earnings catalyst is set for 2026, when over $80 million in low-yield loans will reprice at higher market rates, potentially exceeding 7%.

The most significant opportunity is the fixed-rate loan portfolio that will mature and reprice over the next year. This isn't a forecast; it's a contractual event baked into the balance sheet. Management has confirmed that a total of over $80 million in low-yielding loans will reprice in 2026, moving from sub-4% rates to current market yields that are consistently above 7%.

Here's the quick math: the first half of 2026 alone will see approximately $45 million in loans, currently yielding sub-4%, reset. The latter half of 2026 will see another $35 million to $40 million repricing from an even lower sub-3.75% rate. This structural tailwind is massive, and it's the primary reason the market is watching for a sustained profitability kick-in next year.

The bank's loan pipeline already shows new production at a weighted average yield of approximately 7.1%, so that 7% target is defintely achievable.

Strategic pivot toward higher-yielding assets like consumer and owner-occupied Commercial Real Estate (CRE) loans should improve asset yields.

Management is actively reshaping the loan portfolio to pull forward better yields, moving away from lower-margin multifamily real estate. This strategic shift is already working to expand the asset yield, even before the 2026 repricing wave hits. The yield on the total loan portfolio has been steadily climbing, hitting 4.72% in Q1 2025 and improving further to 4.80% in Q2 2025.

The focus is on two key areas with better risk-adjusted returns:

• Growing the commercial and industrial (C&I) portfolio, including owner-occupied CRE.
• Purchasing credit-enhanced consumer loan pools.

In Q3 2025 alone, the consumer loan portfolio grew by $38 million, and the commercial portfolio was up $7.2 million, showing they are walking the talk on this mix shift.

Active balance sheet management is successfully lowering funding costs by shifting away from expensive Certificates of Deposit (CDs).

The other side of the NIM expansion is cost control, and Blue Foundry Bancorp is showing disciplined funding management. They are strategically moving away from higher-cost Certificates of Deposit (CDs) and instead focusing on growing core deposits (like checking and savings accounts) and using brokered deposits more efficiently.

This has directly led to lower deposit costs, which is a strong sign of good balance sheet management in this rate environment. The cost of interest-bearing deposits decreased by 15 basis points to 2.75% in Q1 2025 and dropped again by 13 basis points to 2.62% in Q2 2025. Core deposits grew by $18.6 million in Q3 2025, which is exactly the cheaper, stickier funding base they need.

The net result of both the asset and liability management is a consistent expansion of the Net Interest Margin (NIM), which reached 2.34% in Q3 2025, up 52 basis points year-over-year.

The deep valuation discount allows management to continue accretive share repurchases, essentially buying a dollar of assets for around 57 cents.

The deep discount to tangible book value (TBV) is a huge opportunity for existing shareholders, and management is capitalizing on it aggressively. The bank's tangible book value per share stood at $15.14 as of Q3 2025. When the stock trades significantly below that, every share repurchase is highly accretive, meaning it immediately boosts the value for remaining shareholders.

In Q3 2025, the company repurchased 837,388 shares at an average price of just $9.09 per share. That's buying a dollar of assets for roughly 60 cents, which is a fantastic use of capital. The market view is even more aggressive, often citing the stock trading around 57 cents on the dollar of its tangible book value.

Since July 2022, Blue Foundry Bancorp has repurchased over 7.7 million shares, or 27.3% of its common shares, at a weighted average price of $10.09. This consistent action signals management's strong confidence in the underlying value and the temporary nature of the current GAAP losses.

Blue Foundry Bancorp (BLFY) - SWOT Analysis: Threats

You're looking at Blue Foundry Bancorp (BLFY) and seeing a bank in transition, but any seasoned analyst knows a turnaround story comes with a waiting game and real, measurable risks. The core threat here is a near-term earnings delay combined with a sudden, measurable deterioration in credit quality. This isn't just market noise; it's structural pressure that demands a clear-eyed view.

The core earnings acceleration is delayed until 2026, which creates a near-term waiting game and stock price overhang.

The biggest structural threat is the delay in core earnings acceleration. While the bank is executing a strategy to increase its Net Interest Margin (NIM), the substantial financial lift is still a year out. For the third quarter of 2025, Blue Foundry Bancorp reported a net loss of $1.9 million, or $0.10 per diluted share.

Management expects the NIM for the fourth quarter of 2025 to be 'relatively flat,' meaning investors are stuck in a holding pattern. The real catalyst-the repricing of low-yield loans-is a 2026 event. Specifically, approximately $45 million in loans currently yielding below 4% are scheduled to reprice in the first half of 2026, with another $35 million to $40 million repricing later that year, potentially at rates above 7%.

Here's the quick math: you're betting on a 2026 event, but the stock price is currently burdened by 2025 losses. That's a long wait for a payoff.

Credit quality risks must be closely monitored, especially with a recently increased level of non-performing loans (NPLs).

You need to pay close attention to the bank's credit quality, as the third quarter of 2025 saw a significant spike in non-performing loans (NPLs). This is a red flag you can't ignore.

NPLs surged by 81% quarter-over-quarter, rising to $11.4 million at September 30, 2025, up from $6.3 million in the prior quarter. This jump was largely driven by a single $5.3 million multifamily commercial credit exposure. The sudden increase caused the Allowance for Credit Losses (ACL) to NPL ratio-a key coverage metric-to drop sharply from 254.02% at year-end 2024 to 121.49% at the end of Q3 2025.

This single-credit event shows that while the overall loan book may be sound, concentration risk remains a material threat. You need to watch the commercial real estate (CRE) portfolio defintely.

Continued pressure on the Net Interest Margin (NIM) if the Federal Reserve's interest rate policy shifts unexpectedly or competition for deposits increases.

While the bank has done a good job managing its funding costs, the Net Interest Margin (NIM) is still vulnerable to external forces. The NIM expanded by 6 basis points to 2.34% in Q3 2025, which is a positive trend, but the market is volatile.

The bank is actively moving away from higher-cost Certificates of Deposit (CDs) toward lower-rate brokered deposits and core deposits. But, if the Federal Reserve's interest rate policy shifts unexpectedly-say, a faster pace of cuts than anticipated-it could compress loan yields quicker than the bank can lower its deposit costs. Also, competition for deposits in the bank's market remains fierce.

The bank has significant time deposit maturities coming in late 2025 and into 2026. Re-funding these deposits without significantly increasing the cost of funds is a constant, near-term operational risk.

Bearish technical signals prevail as of November 2025, indicating short-term price weakness and investor pessimism.

The technical picture for Blue Foundry Bancorp stock as of November 2025 is overwhelmingly bearish, which signals poor short-term investor sentiment.

The stock is trading below its key moving averages, a classic sign of weakness:

• Stock Price (Nov 17, 2025): Opened at $8.12.
• 50-Day Simple Moving Average (SMA): $8.81.
• 200-Day Simple Moving Average (SMA): $9.10.

Multiple analysts have a negative outlook, with the consensus rating being 'Reduce' or 'Sell,' and one firm recently downgraded the stock to a 'Sell' rating on November 17, 2025. The short sale ratio for the stock was 11.32% as of November 14, 2025, suggesting a significant number of traders anticipate further price declines. The Fear & Greed Index is also showing a sentiment of 'Fear' at 39.