Investment Thesis
First Busey Corp demonstrates solid profitability with a net margin of 18.8% and strong free cash flow generation of $173M, but faces headwinds from a 19.5% YoY revenue decline and deteriorating earnings quality evidenced by the 25.8% EPS decline despite positive net income growth. The bank's conservative leverage profile (0.05x debt/equity) and healthy operating cash flow provide financial stability, though weak interest coverage of 1.9x and declining per-share metrics warrant caution.
Strengths
- Strong free cash flow of $173M with 24% FCF margin demonstrates cash generation capability
- Conservative leverage with 0.05x debt/equity ratio and low long-term debt of $113.8M
- Solid net profit margin of 18.8% and operating margin of 25.9% indicate pricing power
- Operating cash flow of $192.6M covers CapEx 9.8x showing sustainable operations
Risks
- Sharp 19.5% YoY revenue decline suggests deteriorating business conditions or competitive headwinds
- EPS down 25.8% YoY despite net income growth indicates significant share dilution or unfavorable tax impacts
- Weak interest coverage ratio of 1.9x leaves limited cushion for debt servicing if conditions worsen
- Low ROA of 0.7% and ROE of 5.5% suggest inefficient asset utilization typical of stressed banks
Key Metrics to Watch
- Revenue trajectory and net interest margin trends to confirm stabilization
- EPS growth reconciliation and share dilution rate going forward
- Interest coverage ratio and loan portfolio quality metrics
- Deposit growth and customer retention indicators
- Capital adequacy ratios and regulatory leverage metrics
Financial Metrics
Revenue
719.6M
Net Income
135.3M
EPS (Diluted)
$1.47
Free Cash Flow
173.0M
Total Assets
18.1B
Cash
294.1M
Profitability Ratios
Gross Margin
N/A
Operating Margin
25.9%
Net Margin
18.8%
ROE
5.5%
ROA
0.7%
FCF Margin
24.0%
Balance Sheet & Liquidity
Current Ratio
N/A
Quick Ratio
N/A
Debt/Equity
0.05x
Debt/Assets
86.4%
Interest Coverage
1.88x
Long-term Debt
113.8M
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: 2026-03-21T17:06:11.745535 |
Data as of: 2025-12-31 |
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