Investment Thesis
Horizon Bancorp exhibits severe operational deterioration masked by headline revenue growth of 58.1%. Diluted EPS collapsed 505% YoY while net income stagnated at 0% growth, indicating fundamental profitability problems. Critical red flags include sub-1.0x interest coverage (0.8x), abysmal returns (ROE 3.7%, ROA 0.4%), and inability to service debt from operating income.
Strengths
- Strong top-line revenue growth of 58.1% YoY
- Conservative leverage with Debt/Equity ratio of 0.36x
- Positive free cash flow of $20.7M with 23.9% FCF margin
Risks
- Interest coverage ratio of 0.8x indicates inability to cover debt service from operating income
- Diluted EPS declined 505% YoY despite revenue surge, signaling severe earnings deterioration or massive dilution
- Return metrics critically weak (ROE 3.7%, ROA 0.4%) suggesting asset quality issues or operational dysfunction in banking model
Key Metrics to Watch
- Interest coverage ratio - must return above 1.5x for viability
- Net income growth trajectory - must align with revenue growth
- Loan loss provisions and nonperforming asset ratios for banking quality assessment
Financial Metrics
Revenue
86.7M
Net Income
26.2M
EPS (Diluted)
$0.51
Free Cash Flow
20.7M
Total Assets
6.6B
Cash
259.1M
Profitability Ratios
Gross Margin
N/A
Operating Margin
37.3%
Net Margin
30.2%
ROE
3.7%
ROA
0.4%
FCF Margin
23.9%
Balance Sheet & Liquidity
Current Ratio
N/A
Quick Ratio
N/A
Debt/Equity
0.36x
Debt/Assets
89.4%
Interest Coverage
0.77x
Long-term Debt
248.6M
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: 2026-05-09T06:31:24.992653 |
Data as of: 2026-03-31 |
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