OAK RIDGE, N.C. - Oak Ridge Financial Services, Inc. (OTCPink: BKOR), the holding company for Bank of Oak Ridge, announced unaudited financial results for the third quarter of 2024 today, revealing a mixture of growth and challenges. The company reported earnings per share of $0.54, which is an increase from the previous quarter's $0.46 but a slight decrease from $0.55 in the third quarter of 2023. The return on equity was 9.56%, marking a rise from 8.57% in the prior quarter, yet down from 10.63% in the same quarter last year.
The bank declared dividends of $0.12 per common share, consistent with the previous quarter and up 20% from the third quarter of 2023. The tangible book value per common share rose to $22.78 at the end of the quarter, compared to $21.95 at the end of the prior quarter and $20.26 at the end of the third quarter of 2023. The net interest margin remained unchanged from the last quarter at 3.81% and saw a marginal decrease from 3.83% in the third quarter of 2023.
Loans receivable saw an 11.1% annualized increase from the prior year-end, reaching $505.5 million, while deposits grew by 4.7% annualized to $510.5 million. However, nonperforming assets rose to $2.9 million at quarter end, a significant increase from $542,000 at the end of the previous quarter, primarily due to four SBA 7(a) loans moving to nonaccrual status.
The bank's securities available-for-sale and held-to-maturity declined by 9.8% annualized from the prior year-end, standing at $102.4 million. Total stockholders' equity increased to $62.9 million, up 7.3% annualized from the end of the prior quarter.
Amidst these financials, the company did not repurchase any shares during the third quarter but bought back 16,700 shares for $321,000 between September 30, 2024, and October 30, 2024. A cash dividend of $0.12 per share is scheduled to be paid on December 3, 2024, to shareholders on record as of November 15, 2024.
Tom Wayne, CEO of Oak Ridge, acknowledged the decrease in earnings per share compared to the same period last year but highlighted the bank's stable net interest margin and solid capital and liquidity positions. He also emphasized the bank's commitment to serving clients and managing the bank safely and soundly.
This financial summary is based on a press release statement from Oak Ridge Financial Services, Inc.
InvestingPro Insights
Oak Ridge Financial Services, Inc. (OTCPink: BKOR) presents an intriguing investment profile based on recent InvestingPro data. The company's P/E ratio of 9.36 suggests that it may be undervalued compared to industry peers, aligning with the bank's reported growth in tangible book value per share. This valuation metric is particularly relevant given the bank's recent financial performance and dividend declarations.
InvestingPro data reveals a dividend yield of 2.5%, with a notable dividend growth of 20% over the last twelve months as of Q2 2024. This corresponds directly with the company's announcement of a $0.12 per share dividend, which represents a 20% increase from the previous year. The consistency in dividend payments, coupled with growth, may signal management's confidence in the bank's financial stability and future prospects.
The Price to Book ratio of 0.87, based on the last twelve months as of Q2 2024, further supports the notion that BKOR might be undervalued. This metric is particularly relevant for financial institutions and suggests that the market price is below the company's book value, potentially offering a margin of safety for investors.
An InvestingPro Tip highlights that Oak Ridge Financial Services has maintained dividend payments for 11 consecutive years, reinforcing the company's commitment to shareholder returns mentioned in the article. Another tip notes that the company's earnings per share are forecast to grow this year, which could provide context to the mixed earnings results reported in the third quarter.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights that could further illuminate Oak Ridge Financial Services' investment potential.
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