First Busey Corporation (BUSE): what the price assumes

In the published model solve dated 2026-Q2, anchored at $30.66, First Busey Corporation (BUSE) is priced for 9.6% return on equity. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-09-07 · Exported: 2026-09-09 · Source: https://boothcheck.com/report/BUSE

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

Solve inputs: computed at a 9.3% cost of equity with 4% terminal growth over a 10-year stage, on common book equity (FY2026).

How unusual the bet is: within-range

Valuation X-Ray

The price is supported by asset-based and earnings-power and growth-DCF value. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Asset, Earnings, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.1%); the inversion above states its own rate.

Per-Model Detail (n=5)

Economic-Unit Decomposition (Sum Of The Parts)

The issuer is a funded financial business. Debt, interest, and cash flows are operating inputs, so industrial EV, net-debt, WACC, and free-cash-flow lenses do not apply; value the common-equity claim with book, earnings, capital, and payout economics.

No unit-level total common-equity value is stated. Each financial unit requires supported standalone common equity, normalized earnings, capital adequacy, and payout capacity. Consolidated debt, interest, and cash are operating balances, not an enterprise-to-equity bridge; company-level book, earnings, capital, and payout lenses remain the coherent cross-checks.

Solvency

Deposit/float-funded balance sheet: debt is funding, not corporate leverage, and GAAP operating cash flow follows loan flows. Net-debt, interest-coverage, and cash-burn lenses do not apply. The solvency frame for a financial is regulatory capital and payout capacity (CET1, stress buffer, dividends plus buybacks against earnings).

Bullet Takeaways

• Nearly half of last year's revenue growth was purchased rather than generated: the CrossFirst acquisition closed on 1 March 2025 and brought $7.50 billion of assets and "Deposits 6,571,699" thousand with it, paid for almost entirely in newly issued shares.
• Credit is the number to watch rather than growth, because potential problem loans rose to "$166.5 million, or 1.2% of portfolio loans, as of March 31, 2026, compared to $116.4 million, or 0.9%" previously.
• Second-quarter results land on 28 July 2026, following an April quarter in which the board lifted the quarterly dividend to $0.26 a share from $0.25.

Bull Case

First Busey grew revenue by nearly half last year, and the honest description of that growth changes how every other number should be read. Revenue reached $666.84 million in 2025, up 46.6%, almost all of it because the bank bought CrossFirst. The deal closed on 1 March 2025 and brought $7.50 billion of total assets, $6.02 billion of portfolio loans net of allowance, and $6.57 billion of deposits. This is a bank in the middle of digesting a business roughly half its own size, and trailing profitability during that digestion is not a reading of what the combined bank earns.

The reason matters, and it is an accounting mechanic worth understanding rather than a euphemism. When a bank acquires loans, the rules require it to book, on day one, an allowance covering the lifetime expected losses on the acquired loans that were not already credit-impaired. The filing describes acquisition expenses for CrossFirst as "comprised primarily of an initial provision to establish an ACL on non-PCD loans (recorded as provision expense)", alongside salaries, benefits and equity compensation. Every dollar of expected loss over the next several years is charged in a single quarter, while the interest income on those same loans arrives over the following years. Reported earnings in the year of a deal are therefore structurally understated relative to the run rate of the business that emerges.

Capital came through the transaction intact. The common equity tier 1 ratio stood at about 12.3% as filed at 31 March 2026, comfortably above the level regulators require, which is what gives the board room to keep returning cash while the integration finishes. It did exactly that in the April quarter, raising the quarterly dividend to $0.26 a share from $0.25, and share repurchases ran alongside it in the first quarter under an existing plan.

The revenue mix is also broader than the bank label suggests. Banking is 87% of revenue, but Wealth Management contributes 10% and FirsTech, a payments and remittance-processing business, another 3%. FirsTech handles "customer service payment processing via telephone; direct debit services; merchant services referral solutions for financial institution partners and their commercial customers; and lockbox remittance processing for mail-based payments." Fee income of that kind does not consume regulatory capital and does not reprice when the Federal Reserve moves, which is precisely the property a rate-sensitive balance sheet wants alongside it.

Finally, the price does not demand very much. The stock changes hands at roughly 1.05 times book value, which sits in the lower half of its peer group on that measure. A bank near book is being asked to earn a return on its capital only a little above what its shareholders require, not to transform itself.

Bear Case

Over the four years to March 2026 the share count grew about 11.8% a year. That is the structural fact a holder has to sit with. The bank is materially larger than it was; each existing owner's claim on it is materially smaller. The CrossFirst transaction is the clearest illustration: net assets acquired came to $760.4 million, and the consideration was almost entirely newly issued common stock rather than cash. Growth bought with equity is growth every existing shareholder helped pay for, and it only creates value if the acquired earnings exceed what the issued shares would otherwise have been worth.

That test is not yet passed on the reported numbers. Trailing net income is $215.2 million, on a balance sheet carrying roughly 14.74 billion dollars of deposits at 31 March 2026. Some of that shortfall is the merger accounting, which front-loads credit provisions. Some of it may not be. The distinction only resolves over several more quarters of clean reporting, and until it does, the bull case rests on an argument about what the numbers would look like rather than on what they do look like.

Credit is moving in the wrong direction while that argument runs. Potential problem loans rose to "$166.5 million, or 1.2% of portfolio loans, as of March 31, 2026, compared to $116.4 million, or 0.9%" in the prior comparison, an increase of roughly a third in the dollar amount. The allowance stands at about 1.27% of loans, which is thin cover if that trend continues rather than reverses. A recently acquired loan book is also the least well understood part of any bank's portfolio, because the credit culture that underwrote it was somebody else's.

The funding side gave a little ground too. Total deposits were 14.74 billion dollars at 31 March 2026 against 14.91 billion at the end of 2025. A single quarter of deposit decline is noise. It is the kind of noise worth tracking closely in a bank whose deposit base was assembled through acquisition, because acquired depositors are the ones most likely to leave when the sign on the branch changes.

The competitive backdrop makes the strategy harder rather than easier. Every regional bank in the comparison set is doing the same thing: RNST grew revenue 70.8%, UMBF 72.5%, CNOB 56.8% and ONB 43.6%, growth rates that only come from consolidation. When an entire cohort is buying the same scarce targets at the same time, the price of the next deal goes up and the returns on it go down. Busey's growth model requires a supply of sellers at sensible prices, and it is competing for them against six other buyers with the same idea.

The valuation offers little cushion in exchange. At roughly 1.05 times book the stock is not expensive, but a bank trading near book has already had most of its optimism removed, which means there is not much of a discount left to absorb a credit surprise. The equity is only worth book value if the loans are worth what the balance sheet says they are.

Valuation

A bank is not valued on a multiple of profit; it is valued on what it earns against the capital it must hold. So the reference point is book value, and First Busey trades at roughly 1.05 times it. Book value works out near 27.47 dollars a share and tangible book near 22.06. What the market is asking, in plain terms, is that the bank earn a return on its capital modestly better than what shareholders require for holding it. Right now it is earning less than that, and the gap between the two is the whole investment question.

Set against the peer group on the same measure, that price-to-book sits in the lower half of the distribution. And the persistence record for a requirement of this kind is comparatively forgiving: roughly 77% of firms earning at this level held it for something like a decade. This is not a demanding bet on an exceptional outcome. It is a bet on a normal one.

The methods used to triangulate the value agree to an unusual degree, which is itself worth noting. Not one family reads the price as expensive. The earnings-power and forward cash-flow methods land above today's price, the peer-multiple methods well above it, and only the asset-value lens sits below, with the price about 13% above its central estimate. When every frame lands at or above the price, the analytical question stops being whether the stock is cheap and becomes why the market is discounting it anyway.

The answer is visible in the credit and integration lines rather than in the valuation. The allowance for credit losses runs at about 1.27% of loans. Potential problem loans reached $166.5 million at 31 March 2026, or 1.2% of the portfolio, up from 0.9% previously. Deposits stood at 14.74 billion dollars, down from 14.91 billion three months earlier. Those are the three numbers a bank investor reads first, and two of the three moved the wrong way in the most recent quarter.

Against them sits the capital position, which is where solvency lives for a bank rather than in coverage ratios or net debt. Common equity tier 1 stood at about 12.3% as filed at 31 March 2026, and that cushion is what funds the payout: the quarterly dividend went to $0.26 a share from $0.25 in April, with buybacks running alongside. The complication is that the buyback is not the dominant force on the share count. Shares outstanding have grown about 11.8% a year over four years, because acquisitions were paid for in stock. Per-share value at this bank has been determined by acquisition arithmetic, not by capital return, and the next few quarters of clean post-integration reporting are what will show whether that arithmetic worked.

Catalysts

Second-quarter results are due on 28 July 2026. It is the fifth full quarter since the CrossFirst acquisition closed on 1 March 2025, which makes it one of the first prints where the year-over-year comparison is closer to like-for-like rather than dominated by the addition of a $7.50 billion balance sheet. The integration-cost line and the credit provision are the two places the quality of the deal will show first.

The credit trend is the specific thing to read. Potential problem loans stood at 166.5 million dollars, or 1.2% of portfolio loans, at 31 March 2026, against 116.4 million and 0.9% previously. If that number stabilises, the merger-accounting explanation for depressed reported earnings holds. If it keeps climbing, the more uncomfortable reading, that the acquired book was underwritten to a different standard, gains ground. Deposits over the same period slipped to 14.74 billion dollars from 14.91 billion at the end of 2025, so the funding line is worth checking in the same print.

Capital return is the steadier signal. The board raised the quarterly dividend to $0.26 a share from $0.25 alongside first-quarter results on 28 April 2026, and repurchases continued under the existing plan during the quarter. A board raising a dividend while finishing an integration is expressing a view about the earnings power on the other side of it, and the common equity tier 1 ratio of about 12.3% as filed at 31 March 2026 is what makes that view affordable.

Peer Cohorts (Per Segment, With Filing Citations)

Banking (reported)

• RNST (RENASANT CORP)
• FY2025 10-K: …quality and pricing. Many of our competitors are larger and have substantially greater resources than we do, including higher total assets and capitalization, larger technology and marketing budgets and a broader offering of financial services, while other competitors are not subject to regulation by federal and…
• FY2025 10-K: …and revenues are derived from, the operations of our community banks, which offer a complete range of banking and financial services to individuals and to businesses of all sizes. As described in more detail below, these services include business and personal loans, interim construction loans, specialty commercial…
• CNOB (CONNECTONE BANCORP, INC.)
• FY2025 10-K: …Officer) can approve loans up to $40 million in aggregate loan exposure with no policy exceptions. Furthermore, the Senior Lending Group has authority to approve unsecured loan amounts without policy exceptions up to $10 million. Loans to insiders must be approved by the entire Board of Directors. -9- Table of…
• FY2025 10-K: …Bank's primary source of funding. Our deposit portfolio is comprised of a diversified range of products designed to meet the needs of both consumer and commercial clients while supporting our liquidity and asset-liability management goals. ● Noninterest-Bearing Demand Deposits: We offer several noninterest-bearing…
• ONB (OLD NATIONAL BANCORP /IN/)
• FY2025 10-K: …capital markets, brokerage, wealth management, trust, and investment advisory services. We earn interest income on loans as well as fee income from the origination of loans and from providing other services to our clients. Lending activities include loans to individuals, which primarily consist of home equity lines…
• FY2025 10-K: …depositors, along with the FDIC, will have priority in payment ahead of unsecured, non-deposit creditors, including depositors whose deposits are payable only outside of the United States, and the parent bank holding company with respect to any extensions of credit it may have made to such insured depository…
• UMBF (UMB FINANCIAL CORP)
• FY2025 10-K: …banking, installment loans, home equity lines of credit, and residential mortgages. The range of client services extends from a basic checking account to estate planning and trust services and includes private banking, brokerage services, and insurance services in addition to a full spectrum of investment advisory,…
• FY2025 10-K: …regularly evaluate Business Segment financial results produced by the Company's internal reporting system in deciding how to allocate resources and assess performance for individual Business Segments. The management accounting system assigns balance sheet and income statement items to each Business Segment using…
• FRME (FIRST MERCHANTS CORP)
• FY2025 10-K: …of certain personal information to a nonaffiliated third party. These regulations affect how consumer information is transmitted through diversified financial companies and conveyed to outside vendors. The Bank is also subject to regulatory guidelines establishing standards for safeguarding customer information.…
• FY2025 10-K: …analysis of the impact on both long- and short-term financial results. Acquisitions typically involve the payment of a premium over book and market values, and, therefore, some dilution of our tangible book value and net income per share may occur in connection with any future transaction. The Corporation's ability…
• QCRH (QCR Holdings, Inc.)
• FY2025 10-K: …to, or other involvement with, such entities. The Banks are taking reasonable measures, including appropriate new account screening and customer due diligence measures, to ensure that existing and potential customers do not engage in any such activities. Nonetheless, the shift in Illinois and Missouri laws legalizing…
• FY2025 10-K: …of relationships between banking organizations and financial technology companies (although the guidance applies more broadly). Privacy and Cybersecurity. The Banks are subject to numerous U.S. federal and state laws and regulations aimed at protecting non-public, personal, and other confidential information of their…
• BOKF (BOK FINANCIAL CORP)
• FY2025 10-K: …$46.3 million, including a $33.3 million increase in personnel expense and a $13.0 million increase in non-personnel expense. The increase in net income before taxes attributed to Funds Management and Other reflects the ongoing application of the Company's transfer pricing methodology. Table 14 - Net Income Before…
• FY2025 10-K: Personnel expense increased $12.8 million, or 7%, largely driven by increased incentive compensation costs, annual merit increases, and salary adjustments. Non-personnel expense increased $3.3 million, or 3%, as the prior year included a recovery of operational losses. The average outstanding balance of loans…

Wealth Management (reported)

• TROW (PRICE T ROWE GROUP INC)
• FY2025 10-K: The investment management industry continues to evolve and face challenging trends, including the shift in market share from traditional active strategies to passive products, persistent downward fee pressure, demand for lower cost investment vehicles, and an ever-changing regulatory landscape. Despite these trends,…
• FY2025 10-K: …management impact our revenues and results of operations. At December 31, 2025, we had $1,775.6 billion in assets under management, an increase of $169.0 billion from the end of 2024. This increase in assets under management was driven by market appreciation, net of distributions not reinvested, of $216.7 billion,…
• AMP (AMERIPRISE FINANCIAL INC)
• FY2025 10-K: …we provide investment management, advice and products to retail, high net worth and institutional clients on a global scale. Revenues in the Asset Management segment are primarily earned based on managed asset balances, which are impacted by market movements, net asset flows, asset allocation and product mix. We may…
• FY2025 10-K: …amp:AdviceAndWealthManagementMember 2023-01-01 2023-12-31 0000820027 us-gaap:OperatingSegmentsMember us-gaap:InvestmentAdviceMember amp:AssetManagementSegmentMember 2023-01-01 2023-12-31 0000820027 us-gaap:OperatingSegmentsMember us-gaap:InvestmentAdviceMember amp:RetirementAndProtectionSolutionsMember 2023-01-01…
• BEN (FRANKLIN RESOURCES, INC.)
• FY2025 10-K: …the Company. We have one operating segment, investment management and related services. We offer our services and products under our various distinct brand names, including, but not limited to, Alcentra ® , Apera ® , Benefit Street Partners ® , Brandywine Global Investment Management ® , Canvas ® , Clarion Partners ®…
• FY2025 10-K: …compared to the Euro. Long-term inflows increased 8% to $343.9 billion, as compared to the prior year, driven by higher inflows across equity, fixed income, and alternative strategies, particularly in open-end funds, retail separately managed accounts, private funds, and sub-advised mutual funds. This growth was…
• IVZ (Invesco Ltd.)
• FY2025 10-K: …competitors have greater financial resources and higher brand recognition than Invesco. However, we believe our experience as a trusted partner to clients, the quality and diversity of our investment capabilities, product types and channels of distribution, and our commitment to innovation enable us to compete…
• FY2025 10-K: …process and a frictionless experience with superior engagement. • Provide a holistic value proposition including advice and solutions to help our clients best manage their portfolios and succeed with their own clients. Grow high demand investment offerings • Prioritize the intersection of market size, secular change,…
• SEIC (SEI INVESTMENTS COMPANY)
• FY2025 10-K: 25. In the preceding tables, assets under management are total assets of our clients or their customers invested in our equity and fixed-income investment programs, collective trust fund programs, and liquidity funds for which we provide asset management services through our subsidiaries and partnerships in which we…
• FY2025 10-K: …upmarket focus and cross‑selling SEI's investment capabilities alongside technology and trust‑based custody, with increasing attention to alternatives access. Competitors for our asset management services may include in-house investment teams and global asset management firms, such as LPL Financial and BlackRock.…
• NTRS (NORTHERN TRUST CORP)
• FY2025 10-K: …subsidiaries, including support from locations in North America, Europe, the Middle East, and the Asia-Pacific region. At December 31, 2025, total Asset Servicing assets under custody/administration (AUC/A), assets under custody, and assets under management (AUM) were $17.4 trillion, $13.6 trillion, and $1.3…
• FY2025 10-K: …by investment firms as collateral for securities borrowed from custody clients are managed by Northern Trust and are included in assets under custody and assets under management Wealth Management Wealth Management fee income is calculated primarily based on market values of client AUC/A and AUM and is impacted by…

FirsTech (reported)

• FOUR (SHIFT4 PAYMENTS, INC.)
• FY2025 10-K: …false 2025 FY 0001794669 P3Y P10Y P3Y P3Y P20Y P10Y P20Y 365 293 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure four:model iso4217:EUR four:Reporting_Unit four:vendor iso4217:NZD four:performanceObligation four:day utr:Rate iso4217:EUR xbrli:shares four:segment 0001794669 2025-01-01 2025-12-31…
• FY2025 10-K: …growth has been fueled by a combination of focused strategic initiatives: Expanding Volume - We aim to accelerate growth by increasing the volume processed through our integrated platform across diverse verticals, including restaurants, hospitality, venues, specialty retail, and e-commerce. In addition to converting…
• PAY (Paymentus Holdings, Inc.)
• FY2025 10-K: …the accounting for costs related to internal-use software to more closely align with current software development methods. The guidance removes references to project stages and clarifies when the Company is required to start capitalizing eligible costs. The new guidance is effective for fiscal years beginning after…
• FY2025 10-K: …reconnects the financial institutions to their customers by providing a frictionless, real-time financial hub where consumers can consolidate their financial obligations, pay bills, move money in real time and deepen their understanding of their own financial position. Customers get a centralized viewpoint over all…
• EVTC (EVERTEC, Inc.)
• FY2025 10-K: …property around our products and offerings, allow EVERTEC to continuously explore and develop new products and services that tend to our customer's needs. We plan to continue investing and growing our merchant, financial institution, fintech, corporate and government customer base by investing in core products,…
• FY2025 10-K: …of charge via the Electronic Data Gathering Analysis and Retrieval (EDGAR) System on the SEC's website at www.sec.gov. We also provide copies of our SEC filings at no charge upon request and make electronic copies of our reports available for download through our website at www.evertecinc.com as soon as reasonably…
• ACIW (ACI WORLDWIDE, INC.)
• FY2025 10-K: …Worldline. We are also competing in some areas with the traditional orchestration layer providers such as IXOpay, Payoneer, Nuvei, and Spreedly. Payments Intelligence and Risk Management Principal competitors for our ACI Fraud Management solution are Accertify (American Express), BAE Systems, Cybersource (Visa), Fair…
• FY2025 10-K: …or our competitors. 25 Table of Contents ITEM 1B. UNRESOLVED STAFF COMMENTS None. ITEM 1C. CYBERSECURITY Risk Management Strategy The oversight of our cybersecurity risk is integrated into our Enterprise Risk Management ("ERM") function and processes and procedures. Our ERM framework integrates our information…
• JKHY (JACK HENRY & ASSOCIATES, INC.)
• FY2025 10-K: …data processing solutions for credit unions of all sizes, and non-core highly specialized core-agnostic products and services that enable banks and credit unions of every asset size and charter, and diverse corporate entities outside the financial services industry, to mitigate and control risks, optimize revenue and…
• FY2025 10-K: …15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its consolidated financial statements and related disclosures. NOTE 2. REVENUE AND DEFERRED COSTS Revenue Recognition The Company generates revenue from data processing, transaction processing, software licensing and…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.