DA Davidson Flag Elevated Non-Performing Assets as Key Risk for Old Second Bancorp, Inc. (OSBC)

Core Insights - Old Second Bancorp, Inc. (OSBC) is recognized as a high-growth small-cap stock, ranking ninth on a recent list of profitable high-growth stocks [1] - DA Davidson has raised its price target for OSBC to $23 from $22, maintaining a Neutral rating, highlighting the impact of the Evergreen acquisition on Q4 results [2] - The company reported strong fourth-quarter results with net interest and dividend income reaching $83.1 million, supported by a net interest margin of 5.09% and an adjusted efficiency ratio of 51.28% [3] Financial Performance - OSBC's profitability is among the strongest in the industry, with significant growth in net interest and dividend income [3] - The company's tangible common equity and tangible book value have increased, despite dilution from acquisitions, indicating improved capital strength [3] Risks and Considerations - DA Davidson flagged elevated non-performing assets as a key risk for OSBC, which remains higher compared to peers [2][3] - While OSBC shows potential as an investment, there are suggestions that certain AI stocks may offer greater upside potential with less downside risk [5]