CHAMBERSBURG, Pa. - Franklin Financial Services Corporation (NASDAQ: FRAF), the parent company of F&M Trust, reported its financial results for the first quarter ended March 31, 2024. The company saw a slight increase in net income to $3.4 million, up from $3.3 million in the first quarter of the previous year, marking a 2.1% year-over-year growth. Still, this was a 3.2% decrease from the $3.5 million reported in the last quarter of 2023.
Diluted earnings per share for the first quarter stood at $0.77, compared to $0.75 in the same period last year. The company's total assets reached a milestone, exceeding $2 billion for the first time in a quarterly report, showing a significant rise from $1.836 billion at the end of December 2023.
The bank's provision for credit losses was $452 thousand, which is lower than the $788 thousand set aside in the previous quarter and the $529 thousand in the first quarter of 2023. Total net loans saw a 1.6% increase from the end of 2023, and total deposits grew by 1.4% in the same period.
Franklin Financial's return on average assets (ROA) was 0.67%, and the return on average equity (ROE) was 10.21%, both showing a decrease compared to the first quarter of 2023. The net interest margin (NIM) also compressed to 2.88% from 3.41% in the prior year.
On April 11, 2024, the company declared a regular quarterly cash dividend of $0.32 per share, to be paid on May 22, 2024, to shareholders of record as of May 2, 2024.
The company's President and CEO, Tim Henry, commented on the quarter's performance, highlighting the growth in assets, loans, and deposits, as well as the maintenance of loan quality and an increase in non-interest income. He also mentioned the announcement of a new community office, which is expected to be operational by the end of the year.
Franklin Financial Services Corporation, based on the press release statement, is the largest independent, locally owned and operated bank holding company in Franklin County with assets over $2 billion. Its subsidiary, F&M Trust, operates in various counties in Pennsylvania and Maryland. The company's stock is traded on the Nasdaq Stock Market under the symbol FRAF.
InvestingPro Insights
Franklin Financial Services Corporation (NASDAQ: FRAF) has recently attracted attention with its financial results for Q1 2024, demonstrating a steadfast performance amidst market challenges. To provide further context to these results, InvestingPro offers additional insights into the company's current financial health and stock performance.
InvestingPro Data reveals a market capitalization of $133.96 million, which, while modest, reflects the firm's stable presence in its market niche. The Price/Earnings (P/E) ratio stands at 9.85 for the last twelve months as of Q4 2023, suggesting that the stock might be undervalued when compared to industry peers. Moreover, Franklin Financial maintains a Price/Book ratio of 1.01, indicating that the market is pricing the company's assets fairly.
InvestingPro Tips highlight that the stock has experienced a significant return over the last week and month, with price total returns of 15.22% and 16.41% respectively. This might indicate a growing investor confidence or a market reaction to recent company developments.
Furthermore, Franklin Financial has a notable track record of dividend reliability, having maintained dividend payments for 41 consecutive years, with a current dividend yield of 4.2%. This could be particularly appealing to income-focused investors.
It is worth noting, according to an InvestingPro Tip, that the stock's RSI suggests it is in overbought territory, which could imply a potential pullback or consolidation in the near term. Additionally, the company's gross profit margins have been identified as weak, which investors may want to monitor in relation to operational efficiency and cost management.
For readers interested in a deeper dive into Franklin Financial's performance and stock potential, InvestingPro offers additional tips and analysis. By using the coupon code PRONEWS24, readers can get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking further valuable insights to inform their investment decisions. There are currently 6 additional InvestingPro Tips available for FRAF at: https://www.investing.com/pro/FRAF.
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