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1. Company Snapshot

1.a. Company Description

Financial Institutions, Inc.operates as a holding company for the Five Star Bank, a chartered bank that provides banking and financial services to individuals, municipalities, and businesses in New York.The company offers checking and savings account programs, including money market accounts, certificates of deposit, sweep investments, and individual retirement and other qualified plan accounts.


Its loan products include term loans and lines of credit; short and medium-term commercial loans for working capital, business expansion, and purchase of equipment; commercial business loans to the agricultural industry; commercial mortgage loans; one-to-four family residential mortgage loans, home improvement loans, closed-end home equity loans, and home equity lines of credit; and consumer loans, such as automobile, secured installment, and personal loans.The company also provides personal insurance products, including automobile, homeowners, boat, recreational vehicle, landlord, and umbrella coverage; commercial insurance comprising property, liability, automobile, inland marine, workers compensation, bonds, crop, and umbrella insurance products; and financial services comprising life and disability insurance, medicare supplements, long-term care, annuities, mutual funds, and retirement programs.In addition, it offers customized investment advisory, wealth management, investment consulting, and retirement plan services, as well as operates a real estate investment trust that holds residential mortgages and commercial real estate loans.


The company operates a network of 48 banking offices in Allegany, Cattaraugus, Cayuga, Chautauqua, Chemung, Erie, Genesee, Livingston, Monroe, Ontario, Orleans, Seneca, Schuyler, Steuben, Wayne, Wyoming, and Yates counties, New York.Financial Institutions, Inc.was founded in 1817 and is headquartered in Warsaw, New York.

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1.b. Last Insights on FISI

The recent performance of Financial Institutions, Inc. was negatively impacted by the settlement of auto lending litigation, which may have resulted in significant costs and potential reputational damage. Additionally, the company's appointment of Angela J. Panzarella to its Board of Directors in January 2025 may have been overshadowed by the subsequent acquisition of voting rights by Barclays PLC, which could potentially influence the company's direction.

1.c. Company Highlights

2. Financial Institutions, Inc. (FISI) Delivers Strong Q3 2025 Results

Financial Institutions, Inc. (FISI) reported a net income available to common shareholders of $20.1 million or $0.99 per diluted share, beating analyst estimates of $0.94. The return on average assets and equity stood at 132 basis points and 13.31%, respectively. Net interest income was $51.8 million, up 5.4% from the second quarter, driven by a 16 basis point expansion in the net interest margin. Noninterest income also saw a significant increase, rising 13.6% to $12.1 million. The company's earnings per share (EPS) performance was robust, and revenue growth was driven by a combination of balance sheet expansion and margin improvement.

Publication Date: Nov -24

📋 Highlights
  • Net Income and Profitability:: $20.1 million net income, $0.99/share, ROAA 1.32%, ROE 13.31%
  • Loan and Deposit Growth:: 1.2% loan growth (commercial in Upstate NY), 3.9% deposit increase
  • Net Interest Margin Expansion:: NIM up 16 bps to 350–355 bps, net interest income $51.8M (+5.4% QoQ)
  • Capital Strength:: TCE 8.74%, common equity Tier 1 11.15%
  • Efficiency Ratio:: 58%, full-year expenses guided to $141 million

Loan and Deposit Growth

The company achieved a 1.2% increase in loans, driven by commercial lending in Upstate New York, and a 3.9% rise in total deposits. Commercial loans now stand at $3 billion, up 1.6% from June 30, 2025, and 8.3% from September 30, 2024. This growth is expected to continue, with the company anticipating to achieve the high end of its loan growth guidance of 1% to 3%.

Capital Position and Efficiency

FISI's capital position remains strong, with tangible common equity (TCE) improving to 8.74% and common equity Tier 1 increasing to 11.15%. The efficiency ratio is approximately 58%, and the company expects full-year expenses to be around $141 million. The guidance for the net interest margin is between 350 and 355 basis points, with expectations of incremental margin improvement in 2026.

Valuation and Outlook

With a Price-to-Tangible Book Value (P/TBV) ratio close to 0.95, FISI appears to be reasonably valued. The Dividend Yield stands at 4.17%, making it an attractive option for income-seeking investors. Analysts estimate revenue growth at 6.8% for next year, indicating a positive outlook for the company. As the company continues to grow its loan portfolio and improve its net interest margin, it is well-positioned for long-term success.

3. NewsRoom

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Financial Institutions, Inc. $FISI Position Increased by Bayview Asset Management LLC

Dec -01

Source: defenseworld.net

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Financial Institutions, Inc. Announces Quarterly Cash Dividend

Nov -17

Source: globenewswire.com

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Financial Institutions, Inc. (FISI) Q3 2025 Earnings Call Transcript

Oct -24

Source: seekingalpha.com

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Financial Institutions, Inc. Reports Third Quarter 2025 Results, Including Net Income Available to Common Shareholders of $20.1 million, or $0.99 per Diluted Share

Oct -23

Source: globenewswire.com

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Financial Insights Inc. Sells 459 Shares of Amazon.com, Inc. $AMZN

Oct -22

Source: defenseworld.net

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Financial Institutions, Inc. Schedules Third Quarter 2025 Earnings Release and Conference Call

Oct -01

Source: globenewswire.com

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Financial Institutions, Inc. Announces New Share Repurchase Program

Sep -22

Source: globenewswire.com

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Financial Institutions, Inc. Announces Quarterly Cash Dividend

Aug -25

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.44%)

6. Segments

Banking

Expected Growth: 2.5%

The 2.5% growth in Banking from Financial Institutions, Inc. is driven by increasing demand for digital banking services, expansion into new markets, and strategic partnerships. Additionally, improving economic conditions, low interest rates, and government initiatives to promote financial inclusion also contribute to this growth.

All Other

Expected Growth: 1.5%

The 1.5% growth in All Other from Financial Institutions, Inc. is driven by increasing demand for diversified financial services, expansion into new markets, and strategic partnerships. Additionally, investments in digital transformation and cost-saving initiatives have improved operational efficiency, contributing to the segment's growth.

7. Detailed Products

Checking Accounts

A type of deposit account that allows customers to deposit and withdraw money, write checks, and use debit cards.

Savings Accounts

A type of deposit account that earns interest and allows limited transactions.

Credit Cards

A type of loan that allows customers to borrow money to make purchases and pay back with interest.

Personal Loans

A type of loan that provides a lump sum of money for personal expenses.

Mortgages

A type of loan that allows customers to purchase a home.

Investment Services

A type of service that allows customers to invest in stocks, bonds, and other investment products.

Insurance Services

A type of service that provides protection against unexpected events such as accidents, illnesses, or natural disasters.

Retirement Accounts

A type of savings account that allows customers to save for retirement.

Business Loans

A type of loan that provides financing for businesses to grow and expand.

Commercial Banking Services

A type of service that provides cash management, trade finance, and other services for businesses.

8. Financial Institutions, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Financial Institutions, Inc. is moderate due to the presence of alternative financial services and products.

Bargaining Power Of Customers

The bargaining power of customers is high due to the availability of multiple financial institutions and the ease of switching between them.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the limited number of suppliers and the high demand for their services.

Threat Of New Entrants

The threat of new entrants is moderate due to the regulatory barriers and high capital requirements to enter the financial services industry.

Intensity Of Rivalry

The intensity of rivalry is high due to the large number of financial institutions competing for market share and the high level of competition in the industry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 40.73%
Debt Cost 4.77%
Equity Weight 59.27%
Equity Cost 8.44%
WACC 6.95%
Leverage 68.72%

11. Quality Control: Financial Institutions, Inc. passed 2 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

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Amalgamated Financial

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Financial Institutions

A-Score: 5.9/10

Value: 6.4

Growth: 3.6

Quality: 3.8

Yield: 9.0

Momentum: 6.0

Volatility: 6.7

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

30.86$

Current Price

30.86$

Potential

-0.00%

Expected Cash-Flows