Investors might want to bet on First Bancorp (FBNC) , as it has been recently upgraded to a Zacks Rank #2 (Buy). This upgrade is essentially a reflection of an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.Si ...

First Bancorp (FBNC) came out with quarterly earnings of $0.84 per share, beating the Zacks Consensus Estimate of $0.78 per share. This compares to earnings of $0.61 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 7.69%. A quarter ago, it was expected that this bank holding company for First Bank would post earnings of $0.72 per share when it actually produced earnings of $0.76, delivering a surprise of 5.56%.Over the last fou ...

News Release For Immediate Release: For More Information, Contact: April 23, 2025 Hillary Kestler 704-644-4137 First Bancorp Reports First Quarter Results SOUTHERN PINES, N.C. - First Bancorp (the "Company") (NASDAQ - FBNC), the parent company of First Bank, reported unaudited first quarter earnings today. The Company announced net income of $36.4 million, or $0.88 diluted earnings per share ("D-EPS"), for the three months ended March 31, 2025 compared to $3.6 million, or $0.08 D-EPS, for the three months e ...

Core Viewpoint - First BanCorp's valuation is under threat due to tariffs affecting the bond market and Puerto Rico's tourism sector, leading to an increase in estimated provision expenses for loan losses and a subsequent reduction in earnings [1] Group 1 - The impact of tariffs on First BanCorp's valuation is significant, particularly concerning the bond market [1] - Puerto Rico's tourism industry is also affected, which has implications for First BanCorp's financial health [1] - The analyst has adjusted the provision expense estimate for loan losses upward, indicating a more cautious outlook for the company's earnings [1]

Acquisitions and Growth - The company acquired GrandSouth Bancorp in January 2023, which had total assets of $1.2 billion, loans of $1.0 billion, and deposits of $1.1 billion, enhancing its presence in high-growth markets in South Carolina [19]. - The company has made several acquisitions in recent years, including Select Bancorp, Inc. for $1.8 billion in October 2021 and Magnolia Financial, Inc. for $15.1 million in September 2020 [20]. - The company’s total assets increased significantly due to recent acquisitions, contributing to its strategic growth initiatives [19]. Lending Practices - As of December 31, 2024, the company reported a diversified loan portfolio, including commercial business loans and real estate loans, with a focus on small to medium-sized businesses [21]. - The company's legal lending limit to any one borrower is approximately $213.6 million, with a structured approval process for loans exceeding individual lending authority [26]. - The company has a conservative lending policy and regularly reviews its loan portfolio to identify areas of concern and manage risk effectively [24][27]. - The company emphasizes maintaining a comprehensive lending policy that meets the credit needs of the communities it serves, including low- and moderate-income customers [24]. - The company maintains a diversified loan portfolio, providing a broad range of commercial and retail lending services, including commercial business loans and real estate construction loans [21]. - As of December 31, 2024, the largest categories of commercial real estate (CRE) loans were retail at approximately 14%, office (non-owner-occupied at 6% and owner-occupied at 3%), commercial at approximately 7%, and warehouse at approximately 6% [30]. - The total lending exposure in Wake County, North Carolina was 9.7% in 2024, down from 10.1% in 2023, while New Hanover County increased to 8.9% from 8.1% [32]. Risk Management - The company’s internal loan review department conducts ongoing assessments of the loan portfolio to ensure adherence to policies and manage risk effectively [28]. - The company has engaged an independent consulting firm to perform assessments of new loan originations and existing credits, enhancing its risk management practices [29]. - The company’s total loan participations purchased as of December 31, 2024, were nominal, indicating a conservative approach to loan participation [22]. Investment Policies - The bank's investment policy aims to maximize income from funds not needed for loan demand, with investments subject to concentration and maturity limits [34]. - The bank's investment portfolio must consist of "investment-grade" securities, with a limit of 15% for high-quality corporate bonds [35]. - The company’s investment policy aims to maximize income from funds not needed for loan demand, investing in U.S. government bonds and GSEs [33]. Workforce and Human Capital - As of December 31, 2024, the bank had 1,345 full-time and 51 part-time associates, with a workforce consisting of approximately 73% females and 18% minorities [50]. - The bank's 401(k) plan matched 100% of each employee's elective deferral amount, up to the first 4% of their contribution, with a 2% non-elective employer contribution based on eligible compensation [55]. - The bank's human capital management strategy emphasizes attracting and retaining top talent, with a focus on diversity and inclusion [51]. Regulatory Environment - The bank is subject to heightened supervision and regulation due to total assets exceeding $10.0 billion, impacting its business operations [60]. - The Bank's dividends are subject to regulatory limitations, ensuring that they do not deplete the capital base below minimum regulatory requirements [80]. - Under Basel III, the Bank's ability to pay dividends is limited unless its common equity conservation buffer exceeds the minimum required capital ratio by at least 2.5% of risk-weighted assets [81]. - The Company is required to maintain a minimum CET1 capital ratio of at least 6.5% and a total capital ratio of at least 10.0% [96]. - The capital conservation buffer requires a minimum CET1 to risk-weighted assets ratio of at least 7.0% [96]. - The Bank is subject to various federal and state consumer protection laws, with increased examination and enforcement leading to potential penalties for non-compliance [72]. - The Company is subject to regulatory capital requirements under Basel III, which became fully phased-in as of January 1, 2019 [92]. Cybersecurity and Compliance - The SEC adopted new cybersecurity disclosure rules in July 2023, requiring public companies to disclose cybersecurity risk management practices and material incidents within four days [99]. - The Company employs a layered defensive approach to cybersecurity, utilizing various tools to monitor and block suspicious activities [100]. - The Company must notify federal regulators within 36 hours of identifying a significant computer-security incident that could disrupt operations [98]. - The BSA requires financial institutions to establish a risk-based system to prevent money laundering and financing of terrorism, with significant compliance obligations [101]. - The AML aims to modernize anti-money laundering laws, requiring financial institutions to develop standards for evaluating technology and internal processes for compliance [102]. - The company faces potential regulatory sanctions, including financial penalties, if it fails to observe cybersecurity regulatory guidance [97]. Market Competition - Competition for deposits is primarily based on the types of deposits offered and rates paid, with pressure to increase deposit rates to retain and attract customers [48]. - The company expects competition in the industry to remain high, with pressure to increase deposit rates to retain and attract new deposits [48][49]. Community Reinvestment - The Bank's community reinvestment record is evaluated by federal regulators, impacting mergers and acquisitions [73]. - In October 2023, the Federal Reserve, FDIC, and OCC issued a final rule to amend CRA regulations, expected to increase thresholds for large banks to receive "Outstanding" ratings starting January 1, 2026 [105].

Core Viewpoint - First Bancorp (FBNC) has been upgraded to a Zacks Rank 2 (Buy), indicating an upward trend in earnings estimates which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Institutional investors often rely on earnings estimates to determine the fair value of a company's shares, leading to stock price movements based on their buying or selling activities [4]. Company Performance Indicators - For the fiscal year ending December 2025, First Bancorp is expected to earn $3.09 per share, reflecting an 11.6% increase from the previous year [8]. - Over the past three months, the Zacks Consensus Estimate for First Bancorp has increased by 0.3%, indicating a positive trend in earnings expectations [8]. Zacks Rating System Overview - The Zacks Rank stock-rating system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks which have generated an average annual return of +25% since 1988 [7]. - The upgrade of First Bancorp to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Group 1: Earnings Performance - First Bancorp reported quarterly earnings of $0.76 per share, exceeding the Zacks Consensus Estimate of $0.72 per share, and up from $0.72 per share a year ago, representing an earnings surprise of 5.56% [1] - The company posted revenues of $102.48 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.48%, and an increase from year-ago revenues of $97.03 million [2] Group 2: Market Performance and Outlook - First Bancorp shares have increased by approximately 0.4% since the beginning of the year, while the S&P 500 has gained 3.2% [3] - The current consensus EPS estimate for the upcoming quarter is $0.74 on revenues of $104 million, and for the current fiscal year, it is $3.08 on revenues of $433 million [7] Group 3: Industry Context - The Zacks Industry Rank for Banks - Southeast is currently in the top 12% of over 250 Zacks industries, indicating a favorable outlook for the sector [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact stock performance [5]

Financial Performance - Net income for Q4 2024 was $3.6 million, or $0.08 diluted EPS, down from $18.7 million ($0.45 EPS) in Q3 2024 and $29.7 million ($0.72 EPS) in Q4 2023[2] - Adjusted net income for Q4 2024 was $31.7 million, or $0.76 adjusted diluted EPS, compared to $29.0 million ($0.70 EPS) in Q3 2024 and $29.7 million ($0.72 EPS) in Q4 2023[3] - The company reported a net income of $3.6 million for the fourth quarter of 2024, down from $29.7 million in the same quarter of 2023[42] - Net income for Q4 2024 was $3,551 thousand, a decrease from $29,674 thousand in Q4 2023, while adjusted net income rose to $31,690 thousand[64] Income and Expenses - Noninterest expenses declined by $1.6 million to $58.3 million in Q4 2024, driven by a $1.3 million decrease in personnel expenses[6] - Noninterest expenses for the fourth quarter of 2024 were $58.3 million, slightly down from $56.4 million in the same quarter of 2023[42] - Noninterest income for Q4 2024 was negative $23.2 million, primarily due to a $36.8 million loss on securities, while excluding this loss, it showed a 0.5% increase from the previous quarter[18] Loans and Deposits - Loan growth accelerated to $8.1 billion, reflecting a $81.1 million increase, or 4.03%, for the quarter[6] - Total loans reached $8.1 billion, an increase of $81.1 million, or 4.0%, from the previous quarter, but a decrease of $55.4 million, or 0.7%, year-over-year[26] - Average deposits increased by $99.4 million to $10.6 billion in Q4 2024, with noninterest-bearing deposits growing by $51.6 million[6] - Total deposits were $10.5 billion, reflecting an increase of $25.6 million, or 1.0%, from the previous quarter, and an increase of $498.9 million, or 5.0%, year-over-year[28] Capital and Ratios - Total risk-based capital ratio was estimated at 16.61% as of December 31, 2024, well above regulatory minimums[6] - The estimated total risk-based capital ratio was 16.61%, down from 16.65% in the previous quarter, but up from 15.54% year-over-year[31] - The tangible common equity to tangible assets ratio was 8.22%, a decrease of 25 basis points from the linked quarter, but an increase of 66 basis points year-over-year[32] - Return on average common equity was 5.48%, up from 1.29% in the previous quarter[46] Asset Management - Total assets amounted to $12.1 billion, a slight decrease of $5.7 million, or 0.19%, from the linked quarter, but an increase of $32.8 million, or 0.27%, year-over-year[23] - Total assets as of December 31, 2024, were $12.1 billion, with net loans amounting to $7.97 billion[37][44] - Total interest-earning assets increased to $11,508,581 thousand with net interest income of $332,273 thousand, reflecting a net yield of 2.89% for the twelve months ended December 31, 2024[56] Credit Losses - The provision for credit losses was $507,000 for the fourth quarter of 2024, significantly lower than $2.95 million in the same quarter of 2023[42] - Provision for credit losses was $507,000 for the quarter, significantly lower than $14,200,000 in the prior quarter[50] - The company reported a provision for credit losses of $13,000 thousand in Q4 2024, reflecting ongoing risk management strategies[64] Liquidity - The company continues to manage liquidity sources adequately to meet its operating needs for the foreseeable future[34] - The on-balance sheet liquidity ratio at December 31, 2024, was 17.6%, with a total liquidity ratio of 34.9% including $2.4 billion in available lines of credit[35] - Noninterest-bearing deposits comprised 32% of total deposits, indicating a stable funding source[29]

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Core Viewpoint - First Bancorp (FBNC) has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook on its earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on the consensus measure of EPS estimates from sell-side analysts, reflecting the company's changing earnings picture [1][2]. - A strong correlation exists between earnings estimate revisions and near-term stock price movements, making the Zacks rating system valuable for investors [4][6]. Institutional Investor Influence - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to significant price movements based on their buying or selling actions [4]. First Bancorp's Earnings Outlook - First Bancorp is projected to earn $2.72 per share for the fiscal year ending December 2024, representing a year-over-year increase of 7.5% [8]. - Over the past three months, the Zacks Consensus Estimate for First Bancorp has risen by 1.5%, indicating a positive trend in earnings estimates [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - The upgrade of First Bancorp to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting potential for higher stock movement in the near term [11].