Old Second Bancorp (OSBC): Revisiting Valuation After Strong Buy Rating and Evergreen Bank Acquisition Optimism

Old Second Bancorp (OSBC) is back on investors radar after management struck an upbeat tone at the Raymond James Small Cap Bank Summit, spotlighting recent revenue growth and its Evergreen Bank acquisition.

See our latest analysis for Old Second Bancorp.

That upbeat tone seems to be feeding into sentiment, with the share price at $19.62 and a solid year to date share price return alongside a triple digit five year total shareholder return that points to momentum still building rather than fading.

If Old Second’s deal making has you thinking more broadly about financials, it could be worth exploring fast growing stocks with high insider ownership as a way to uncover other under the radar opportunities.

With earnings still growing faster than revenue and the stock trading at a discount to analyst targets, the key question now is whether Old Second’s resilience signals a genuine buying opportunity or if markets are already pricing in its next leg of growth.

Most Popular Narrative Narrative: 9.8% Undervalued

With Old Second Bancorp’s fair value estimate sitting above the current $19.62 share price, the most followed narrative leans toward meaningful upside from here.

The recent Evergreen Bank acquisition is performing ahead of expectations, providing higher than expected profitability and a more favorable asset mix, which is expected to drive incremental revenue growth, strengthen net interest margin, and enhance ROA as integration is completed.

Read the complete narrative.

Want to see what kind of revenue climb, margin expansion, and profit multiple this narrative is baking in? The projected earnings step change may surprise you.

Result: Fair Value of $21.75 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, concentrated exposure to Illinois and intensifying digital competition could quickly undermine loan growth, margins, and the upbeat long term earnings trajectory.

Find out about the key risks to this Old Second Bancorp narrative.

Another Angle on Value

While the main narrative sees Old Second as 9.8% undervalued, the price to earnings picture is less generous. At 14.6 times earnings, the stock trades above both US bank peers at 11.7 times and a 14.4 times fair ratio. This hints at thinner upside and more downside risk if expectations slip.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Old Second Bancorp Narrative

If you see the story differently or want to dig into the numbers yourself, you can build a custom view in just a few minutes: Do it your way.

A great starting point for your Old Second Bancorp research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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