Investment Thesis
1895 Bancorp is currently unprofitable with negative net income of $981K despite 69.4% revenue growth, indicating operational challenges and poor cost management. The company generates minimal positive free cash flow of $342K while operating at negative margins, suggesting the revenue growth is not translating into sustainable profitability. With a weak balance sheet showing liabilities consuming 87% of assets, the company requires significant operational turnaround before it can be considered investment-grade.
Strengths
- Strong revenue growth of 69.4% year-over-year demonstrates expanding market presence
- Positive free cash flow of $342K indicates some ability to generate cash despite losses
- Modest debt-to-equity ratio of 0.00x suggests limited financial leverage risk
- Reasonable equity base of $73.2M provides some capital cushion for a small regional bank
Risks
- Company is unprofitable with negative net margin of -5.4% and negative operating income of -1.5M
- Negative ROE of -1.3% and ROA of -0.2% indicate poor capital efficiency and value destruction
- Negative interest coverage ratio of -0.3x suggests inability to cover interest expenses from operations
- High liability-to-asset ratio of 87% indicates significant financial leverage and limited margin for error
- Deteriorating EPS momentum with -4000% YoY decline signals fundamental business stress
- No insider purchases in last 90 days despite poor fundamentals suggests lack of management confidence
Key Metrics to Watch
- Path to profitability and timeline for positive operating income
- Operating margin expansion as revenue scales
- Non-performing assets and loan loss provisions as percentage of total assets
- Net interest margin trends and deposit growth metrics
- Capital adequacy ratios and regulatory compliance status
Financial Metrics
Revenue
18.3M
Net Income
-981.0K
EPS (Diluted)
$-0.18
Free Cash Flow
342.0K
Total Assets
564.5M
Cash
N/A
Profitability Ratios
Gross Margin
N/A
Operating Margin
-8.4%
Net Margin
-5.4%
ROE
-1.3%
ROA
-0.2%
FCF Margin
1.9%
Balance Sheet & Liquidity
Current Ratio
N/A
Quick Ratio
N/A
Debt/Equity
0.00x
Debt/Assets
87.0%
Interest Coverage
-0.26x
Long-term Debt
N/A
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-03-20T19:38:11.479173 |
Data as of: 2024-09-30 |
Powered by Claude AI