First National Q2 EPS rises, net interest margin improves

Overview

• US community bank's Q2 adjusted EPS rose yr/yr, net interest income increased

• Net interest margin improved to 4.15% from 3.95% a year earlier

• Company received regulatory approvals for pending North Carolina branch sale, part of branch optimization

Outlook

• Company expects to close sale of North Carolina branches early in Q4 2026

• Company anticipates a one-time gain on branch sale in Q4 2026

• Company plans to consolidate three additional banking offices and discontinue low volume ATMs before year-end

Result Drivers

• LOAN AND DEPOSIT GROWTH - Net interest income rose on higher average loan and deposit balances and improved yields

• ASSET QUALITY - Sound asset quality supported results, with non-performing assets at 0.23% of total assets

• NONINTEREST INCOME - Modest increase in noninterest income from higher ATM and check card income, other operating income, and brokered mortgage fees

Company press release: ID:nGNX7nLy1H

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy."

• Wall Street's median 12-month price target for First National Corp is $28.50, about 5.9% below its July 28 closing price of $30.28

• The stock recently traded at 12 times the next 12-month earnings vs. a P/E of 11 three months ago

Reuters Recommended Reads

• July 28 - First Commonwealth Financial Q2 adjusted EPS beats estimates, net interest margin rises

• July 29 - Stock Yards Bancorp Q2 net income rises on loan, margin growth

• July 27 - Northwest Bancshares Q2 net income rises 59% to record on higher net interest income

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)