| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 135.06 | 17 |
| Intrinsic value (DCF) | 1146.46 | 895 |
| Graham-Dodd Method | 112.00 | -3 |
| Graham Formula | 426.99 | 271 |
Northeast Bank (NASDAQ: NBN) is a regional financial institution headquartered in Portland, Maine, serving individual and corporate clients across Western, Central, and Southern Maine. Founded in 1872, the bank offers a comprehensive suite of deposit products, including checking, savings, money market, and retirement accounts, alongside a diversified loan portfolio featuring residential mortgages, commercial real estate loans, SBA loans, and consumer financing. Northeast Bank distinguishes itself through personalized banking solutions, digital services like online and mobile banking, and a network of nine branches. Operating in the competitive regional banking sector, the bank focuses on community-driven lending and deposit services while maintaining a strong balance sheet. With a market capitalization of approximately $653 million, Northeast Bank remains a key player in Maine's financial ecosystem, emphasizing local relationships and niche commercial lending.
Northeast Bank presents a mixed investment profile. Its low beta (0.602) suggests relative stability compared to broader markets, and a strong diluted EPS ($7.58) reflects efficient profitability. However, modest revenue growth ($151.2M in FY2024) and a small dividend yield ($0.04/share) may limit appeal to income-focused investors. The bank’s commercial real estate and SBA loan focus could face headwinds in a rising-rate environment, though its conservative leverage (total debt of $365M against $242M cash) mitigates risk. Investors may value its regional niche and profitability, but competition and macroeconomic sensitivity warrant caution.
Northeast Bank’s competitive advantage lies in its deep regional presence and specialization in commercial real estate and SBA lending, which allows for higher-margin niche services compared to generic retail banking. Its small branch footprint (nine locations) reduces overhead while maintaining local customer relationships—a critical edge against national banks. However, its limited geographic diversification exposes it to Maine’s economic fluctuations. Digital offerings (mobile/online banking) are table stakes but lack differentiation against tech-forward peers. The bank’s loan portfolio skew toward commercial real estate could be a double-edged sword: it commands higher yields but increases vulnerability to sector downturns. Capital efficiency (evidenced by strong net income of $58.2M) is a strength, though scale disadvantages persist against larger regional players with broader product suites and lower funding costs.