| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 27.85 | 12 |
| Intrinsic value (DCF) | 17.69 | -29 |
| Graham-Dodd Method | 3.01 | -88 |
| Graham Formula | 44.65 | 79 |
Union Bankshares, Inc. (NASDAQ: UNB) is a regional bank holding company operating through its subsidiary, Union Bank, serving northern Vermont and New Hampshire. Established in 1891 and headquartered in Morrisville, Vermont, the company provides a comprehensive suite of retail, commercial, and municipal banking services. Its offerings include personal and business deposit accounts, commercial and residential loans, SBA-guaranteed loans, and cash management solutions. Union Bank also delivers digital banking services, including online and mobile banking, remote deposit capture, and merchant credit card processing. With 18 banking offices, 3 loan centers, and multiple ATMs, Union Bankshares focuses on serving individuals, small-to-medium businesses, nonprofits, and local government entities. As a community-focused financial institution, Union Bankshares emphasizes personalized service and local decision-making, positioning itself as a trusted banking partner in its regional markets. The company operates in the competitive regional banking sector, where differentiation through customer service and niche market expertise is critical.
Union Bankshares (UNB) presents a stable, low-beta (0.573) investment opportunity in the regional banking sector, appealing to income-focused investors with its $1.44 annual dividend per share (yielding ~3.5% based on current market cap). The bank demonstrates consistent profitability with $8.76M net income in its latest fiscal year and solid operational cash flow of $12.15M. However, investors should note the company's relatively small market cap (~$138M) and geographic concentration in northern New England, which may limit growth potential compared to larger regional peers. The bank's conservative risk profile (evidenced by its below-market beta) could appeal to defensive investors, but its loan portfolio's exposure to Vermont and New Hampshire's modest economic growth may constrain revenue expansion. The absence of capital expenditures suggests limited near-term growth initiatives, potentially making UNB more suitable for dividend investors than growth-oriented portfolios.
Union Bankshares competes in the highly fragmented New England regional banking market, where its primary competitive advantage stems from deep community ties and localized decision-making. The bank's 130+ year history in Vermont provides strong brand recognition and customer loyalty in its core markets. Its small size allows for personalized service that larger regional banks cannot match, particularly in commercial lending where relationship banking is critical. However, UNB faces significant challenges from both larger regional banks with greater technological resources and smaller community banks with similar service models. The bank's digital offerings, while adequate, may lag behind those of tech-savvy competitors in attracting younger demographics. Its commercial lending focus on small businesses provides niche expertise but exposes it to economic cyclicality in its concentrated geographic market. Union Bank's municipal banking services provide stable revenue streams but face competition from specialized public finance institutions. The bank's conservative balance sheet (with moderate leverage at $276M total debt against $158M cash) positions it well for interest rate volatility but may limit aggressive market expansion. Its 3.5% dividend yield is competitive among small-cap banks but not exceptional in the current rate environment.