| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 30.77 | -16 |
| Intrinsic value (DCF) | 47.10 | 29 |
| Graham-Dodd Method | 25.77 | -30 |
| Graham Formula | 66.39 | 81 |
Peoples Bancorp of North Carolina, Inc. (NASDAQ: PEBK) is a regional bank holding company that operates Peoples Bank, serving individuals and small to medium-sized businesses across North Carolina. Founded in 1912 and headquartered in Newton, NC, the company provides a comprehensive suite of banking services, including commercial and consumer banking, loans (commercial real estate, residential mortgages, agricultural loans), and non-deposit investment products. With 17 banking offices and multiple loan production offices, PEBK focuses on community-driven financial solutions, including insurance agency services and real estate appraisal. The bank’s conservative lending approach and strong regional presence in growing markets like Charlotte and Raleigh position it as a stable player in the Southeastern U.S. banking sector. Its market cap of ~$156.5M reflects its niche focus, while its low beta (0.645) suggests resilience to broader market volatility. PEBK’s emphasis on localized customer relationships and diversified revenue streams (including brokerage and appraisal services) differentiates it from larger national banks.
Peoples Bancorp of North Carolina (PEBK) presents a conservative investment opportunity with moderate growth potential, suited for income-focused investors. The bank’s diluted EPS of $2.98 and dividend yield (~3.1% at current prices) underscore its profitability and commitment to shareholder returns. Its low beta indicates lower systemic risk, appealing to defensive portfolios. However, PEBK’s small market cap and regional concentration limit scalability, exposing it to local economic downturns. Net income of $16.4M on $71.1M revenue reflects efficient operations, but competition from larger regional banks (e.g., Truist, First Citizens) could pressure margins. The bank’s solid liquidity ($59.3M cash) and manageable debt ($19.6M) provide stability, but investors should monitor interest rate sensitivity and loan portfolio performance.
PEBK’s competitive advantage lies in its hyper-localized community banking model, fostering strong customer relationships in underserved North Carolina markets. Unlike national banks, PEBK offers personalized services like agricultural loans and ITIN mortgages, catering to niche segments. Its appraisal and brokerage divisions add fee-based revenue diversification. However, its small scale limits technology investments (e.g., digital banking), where larger peers like First Citizens (FCNCA) excel. PEBK’s loan portfolio is concentrated in commercial real estate (~50% of total loans), which could face stress in a downturn, though its conservative underwriting mitigates risk. The bank’s 17 branches are strategically located in high-growth areas (e.g., Charlotte, Raleigh), but its lack of geographic diversification outside North Carolina is a vulnerability. Capital ratios are healthy, but PEBK’s ability to compete for deposits against higher-yielding online banks remains a challenge. Its insurance agency services provide cross-selling opportunities, but fintech encroachment in payment services could pressure traditional revenue streams long-term.