Where the Heading? Sierra Bancorp (NASDAQ: BSRR)

May 5, 2020 Oliver Rider 169 Views BSRR, Sierra Bancorp

Sierra Bancorp (NASDAQ: BSRR) spotted trading -9.32% off 52-week high price. On the other end, the stock has been noted 20.57% away from the low price over the last 52-weeks. The stock changed 0.11% to recent value of $27.34. The stock transacted 30134 shares during most recent day however it has an average volume of 34.74K shares. The company has 15.64M of outstanding shares and 13.94M shares were floated in the market.

Sierra Bancorp (BSRR) recently reported its unaudited financial results for the quarter and the year ended December 31, 2019. Sierra Bancorp stated consolidated net income of $9.285M for the fourth quarter of 2019, representing a raise of $1.381M, or 17%, relative to the fourth quarter of 2018. The favorable variance in net income came largely from the positive impact of a higher average balance of interest-earning assets and a lower loan loss provision. The Company’s return on average assets was 1.41% in the fourth quarter of 2019, return on average equity was 11.97%, and diluted earnings per share were $0.60.

For the full year in 2019 the Company recognized net income of $35.961M, which reflects a raise of 21% relative to net income in 2018. The Company’s financial performance metrics for the year include an annualized return on average equity of 12.23%, a return on average assets of 1.40%, and diluted earnings per share of $2.33.

Assets totaled $2.594B at December 31, 2019, representing a raise of $71M, or 3%, for the year. The increase in assets resulted from a higher level of outstanding balances on mortgage warehouse lines and growth in investment securities, partially offset by runoff in real estate loans and commercial loans. Gross loans grew to $1.763B at December 31, 2019, for a raise of $31M, or 2%, for the year. Total nonperforming assets increased by $299,000, or 5%, during 2019. Deposits totaled $2.168B at December 31, 2019, representing a year-to-date organic increase of $52M, or 2%, while non-deposit borrowings were reduced by $27M.

Financial Highlights

As noted above, net income increased by $1.381M, or 17%, for the fourth quarter of 2019 relative to the fourth quarter of 2018, and by $6.284M, or 21%, for the year in 2019 as contrast to 2018. Important variances in the components of pre-tax income and in our provision for income taxes, including some items of a nonrecurring nature, are noted below.

Net interest income increased by $764,000, or 3%, for the fourth quarter of 2019 over the fourth quarter of 2018 and $4.975M, or 5%, for the year in 2019 relative to 2018. The increase for the fourth quarter is Because of growth in average interest-earning assets totaling $141M, or 6%, partially offset by a 12-basis point drop in our net interest margin. Organic growth in the average balance of mortgage warehouse loans and investments contributed to the increase in average earning assets. However, our net interest margin was negatively influenced by the following factors: A declining interest rate environment in 2019, given our asset-sensitive balance sheet; a shift in our earning asset mix into lower-yielding loans and investments; aggressive pricing instituted on mortgage warehouse lines to encourage increased line utilization; higher average rates paid on brokered deposits; and, a shift in the mix of our interest-bearing liabilities toward higher-cost funding sources. The improvement in net interest income for the comparative year-to-date periods resulted from a raise of $152M, or 7%, in average interest-earning assets that was partially offset by a five-basis point decline in our net interest margin. As noted, our net interest margin has been unfavorably influenced in recent periods by market factors and competitive forces, although we have seen a positive impact on the cost of time deposits both from declining rates during 2019 and the recent runoff of relatively high-rate deposits purchased in late 2018. The comparative results were also importantly influenced by nonrecurring interest items, which typically include interest income recovered upon the resolution of nonperforming loans, the reversal of interest income when a loan is placed on non-accrual status, and accelerated fees or prepayment penalties recognized for early payoffs. Nonrecurring items added $515,000 to interest income in the fourth quarter of 2019, as contrast to only $17,000 in the fourth quarter of 2018. For the year, nonrecurring items supplemented interest income by $820,000 in 2019 and $277,000 in 2018. Moreover, discount accretion on loans from whole-bank acquisitions improved our net interest margin by five basis points in the fourth quarter of 2019 as contrast to four basis points in the fourth quarter 2018, and four basis points for the year in 2019 relative to seven basis points in 2018.

The price moved ahead of -1.83% from the mean of 20 days, -2.55% from mean of 50 days SMA and performed 2.85% from mean of 200 days price. Company’s performance for the week was -1.23%, -5.82% for month and YTD performance remained -6.11%.