SmartFinancial, Inc. (SMBK) | Investment Case

1. Company Snapshot

1.a. Company Description

SmartFinancial, Inc.operates as the bank holding company for SmartBank that provides various financial services to individuals and corporate customers.It operates through Commercial Real Estate, Consumer Real Estate, Construction and Land Development, Commercial and Industrial, and Consumer and Other segments.

The company offers noninterest-bearing and interest-bearing checking, interest-bearing demand, savings, money market, time deposit, individual retirement accounts, as well as certificates of deposit.It also provides commercial and residential real estate, consumer real estate, and construction and land development loans; commercial and financial loans; mortgage loans; and direct consumer installment loans, educational, and other revolving credit loans; and overdraft facilities.In addition, the company offers wealth management, insurance, mortgage origination, and Internet and mobile banking services.

As of March 1, 2022, it had 41 full-service branches and 2 loan production offices in East and Middle Tennessee, Alabama, and the Florida Panhandle.The company is headquartered in Knoxville, Tennessee.

Show Full description

1.b. Last Insights on SMBK

SmartFinancial, Inc.'s recent performance was driven by strong Q2 earnings, with net income of $11.7 million, or $0.69 per diluted common share, beating Zacks Consensus Estimate of $0.66 per share. The company's operating earnings, excluding non-recurring income, also showed improvement. Additionally, SmartFinancial's board of directors declared a quarterly cash dividend of $0.08 per share, demonstrating its commitment to shareholder value. The company's solid earnings report and dividend announcement likely reflect positively on its financial health and growth prospects.

1.c. Company Highlights

Last Price	37.15
Change Percentage	-0.59%
Open	37.19
Previous Close	37.37
Market Cap ( Millions)	633
Volume	47178
Year High	37.92
Year Low	26.31
M A 50	35.44
M A 200	33.72

FCF Yield	9.57%
Dividend Yield	0.86%
ROE	2.59%
Debt / Equity	0.00%
Net Debt / EBIDTA	-60.37%
Price To Book	0.11
Price Earnings Ratio	13.47
Price To FCF	10.45
Price To sales	2.09
EV / EBITDA	5.73

2. SmartFinancial's Q3 2025 Earnings: A Strong Performance

SmartFinancial, Inc. reported a robust third-quarter 2025 performance, with operating earnings of $14.5 million or $0.86 per diluted share, surpassing estimates of $0.73. The company achieved its sixth consecutive quarter of positive operating leverage and reached a $50 million quarterly revenue target. Tangible book value grew 26% annualized quarter-over-quarter to $26 per share. The net interest margin was 3.25%, and the company expects it to be in the 3.3% to 3.35% range in the fourth quarter.

Publication Date: Nov -05

                                    📋 Highlights
                                    Operating Earnings::
                                                $14.5M ($0.86 per share), achieving $50M quarterly revenue target and 6th consecutive positive operating leverage quarter.
Tangible Book Value Growth::
                                                26% annualized QoQ increase to $26/share, driven by balance sheet expansion (10% loan growth, 15% deposit growth).
Net Interest Margin (NIM)::
                                                3.25%, with Q4 guidance of 3.3%–3.35%, supported by deposit cost reductions and margin expansion forecasts of 5–7 bps/qtr in 2026.
Capital Allocation::
                                                Sub-debt issuance to pay down $111M in brokered deposits (maturing in next quarter) and reinvestment of insurance operations gain into higher-yielding securities.
Expense and Growth Guidance::
                                                2026 non-interest expenses targeted at $34–$35M, with 10% loan growth projected and technology-driven efficiency (AI, bots) to sustain staffing levels during scaling.

                                

Balance Sheet Expansion and Asset Quality

The company's balance sheet expanded with 10% annualized loan growth and 15% annualized deposit growth. Non-performing assets remained low at 0.22% of total assets, indicating strong asset quality. The company issued sub-debt and used the proceeds to pay down higher-cost brokered deposits, optimizing its funding mix.

Strategic Initiatives and Guidance

For the fourth quarter, the company expects non-interest income to be approximately $7 million and non-interest expense to be in the range of $32.5 million to $33 million. The company remains focused on growth, talent acquisition, and expense management, with a goal to continue growing at a high single-digit pace. The technology team is enhancing platforms, exploring AI, and using bots to increase efficiency, allowing for reinvestment in the business.

Outlook and Valuation

The company expects to continue its trend of positive operating leverage in 2026, with revenue growth anticipated to outweigh expense run rates. Analysts estimate next year's revenue growth at 9.3%. With a current Price-to-Tangible Book Value (P/TBV) ratio not directly available, we can look at the Price-to-Book Ratio (P/B) of 0.1, indicating the stock might be undervalued relative to its book value. The Dividend Yield is 0.91%, providing a relatively stable return. Given the company's strong performance and guidance, the stock's valuation appears reasonable, with the market already pricing in a significant portion of its growth prospects.

3. NewsRoom

Bailard Inc. Grows Position in SmartFinancial, Inc. $SMBK

Nov -15

Source: defenseworld.net

Acadian Asset Management LLC Boosts Stock Holdings in SmartFinancial, Inc. $SMBK

Nov -14

Source: defenseworld.net

SmartFinancial Approves Regular Quarterly Cash Dividend

Nov -03

Source: businesswire.com

Head to Head Review: SmartFinancial (NASDAQ:SMBK) and Amerant Bancorp (NYSE:AMTB)

Oct -26

Source: defenseworld.net

SmartFinancial (NASDAQ:SMBK) and Amerant Bancorp (NYSE:AMTB) Critical Survey

Oct -24

Source: defenseworld.net

SmartFinancial, Inc. (SMBK) Q3 2025 Earnings Call Transcript

Oct -22

Source: seekingalpha.com

SmarFinancial (SMBK) Q3 Earnings: How Key Metrics Compare to Wall Street Estimates

Oct -22

Source: zacks.com

SmarFinancial (SMBK) Q3 Earnings and Revenues Top Estimates

Oct -21

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.00%)

6. Segments

Banking and Related Activities

Expected Growth: 11%

Strong loan growth driven by increased commercial lending and mortgage banking activities, coupled with expansion into new markets and strategic acquisitions. Additionally, digital transformation initiatives and investments in technology have improved operational efficiency, further contributing to the 11% growth in Banking and Related Activities at SmartFinancial, Inc.

7. Detailed Products

Insurance Comparison Platform

A platform that allows users to compare insurance quotes from various insurance providers

Insurance Agency Management System

A system that helps insurance agencies manage their operations, including policy management, customer management, and reporting

Lead Generation Services

A service that provides insurance leads to insurance agents and agencies

Insurance Carrier Integration

A service that integrates with insurance carriers to provide real-time quotes and binding capabilities

Data Analytics and Reporting

A platform that provides data analytics and reporting capabilities to help insurance agencies and carriers make data-driven decisions

8. SmartFinancial, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

SmartFinancial, Inc. operates in a highly competitive industry, and customers have various alternatives to choose from. However, the company's strong brand recognition and customer loyalty mitigate the threat of substitutes.

Bargaining Power Of Customers

SmartFinancial, Inc.'s customers have limited bargaining power due to the company's diversified product offerings and strong distribution network.

Bargaining Power Of Suppliers

SmartFinancial, Inc. relies on a few key suppliers for its operations, giving them some bargaining power. However, the company's strong relationships with suppliers and its ability to negotiate favorable terms mitigate this risk.

Threat Of New Entrants

The financial services industry is highly competitive, and new entrants can easily disrupt the market. SmartFinancial, Inc. must continue to innovate and differentiate itself to stay ahead of new competitors.

Intensity Of Rivalry

The financial services industry is highly competitive, and SmartFinancial, Inc. faces intense rivalry from established players. The company must focus on differentiating itself and providing exceptional customer service to maintain its market share.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	9.82%
Debt Cost	7.30%
Equity Weight	90.18%
Equity Cost	7.30%
WACC	7.30%
Leverage	10.89%

11. Quality Control: SmartFinancial, Inc. passed 3 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

SmartFinancial

A-Score: 6.0/10

Value: 6.6

Growth: 5.8

Quality: 6.4

Yield: 2.0

Momentum: 7.5

Volatility: 8.0

1-Year Total Return ->

Horizon Bancorp

A-Score: 5.9/10

Value: 7.6

Growth: 3.0

Quality: 4.7

Yield: 8.0

Momentum: 6.0

Volatility: 6.3

1-Year Total Return ->

First Bank

A-Score: 5.9/10

Value: 4.8

Growth: 4.9

Quality: 6.8

Yield: 4.0

Momentum: 8.0

Volatility: 7.0

1-Year Total Return ->

NSTS Bancorp

A-Score: 5.8/10

Value: 7.7

Growth: 5.7

Quality: 4.1

Yield: 0.0

Momentum: 7.5

Volatility: 9.7

1-Year Total Return ->

MidWestOne Financial Group

A-Score: 5.1/10

Value: 6.0

Growth: 2.1

Quality: 7.0

Yield: 7.0

Momentum: 5.0

Volatility: 3.7

1-Year Total Return ->

Live Oak Bancshares

A-Score: 4.6/10

Value: 6.0

Growth: 8.3

Quality: 6.2

Yield: 0.0

Momentum: 2.0

Volatility: 5.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-6.17%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.30%

SmartFinancial, Inc. - JP3346970001

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on SMBK

1.c. Company Highlights

Weak Momentum

Average Yield

Average Quality

Earnings Beats

Revenues Beats

Average Growth

Stable Momentum

Strong Momentum

Fairly Valued

Medium Volatility

Lower Quality

Revenues Miss

2. SmartFinancial's Q3 2025 Earnings: A Strong Performance

Balance Sheet Expansion and Asset Quality

Strategic Initiatives and Guidance

Outlook and Valuation

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.00%)

6. Segments

Banking and Related Activities

Expected Growth: 11%

7. Detailed Products

Insurance Comparison Platform

Insurance Agency Management System

Lead Generation Services

Insurance Carrier Integration

Data Analytics and Reporting

8. SmartFinancial, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: SmartFinancial, Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

37.15$

Current Price

37.15$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA