FNB CORP/PA/ (FNB): what the price assumes

In the published model solve dated 2026-Q2, anchored at $18.41, FNB CORP/PA/ (FNB) is priced for 10.1% 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 2026-07-26.

Generated: 2026-08-30 · Source: https://boothcheck.com/report/FNB

Headline

What The Price Assumes (Inversion)

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

Solve inputs: computed at a 10.4% cost of equity with 4% terminal growth over a 10-year stage, on common book equity (FY2026).

How unusual the bet is: elevated

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 7.0%); the inversion above states its own rate.

Per-Model Detail (n=6)

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

• Roughly a quarter of the deposits funding this bank pay no interest at all, a mix it has now held for seven consecutive quarters, which is the most valuable thing a regional lender of this size can own.
• What the price needs is about two more points of return: the bank recently earned close to 8.4 percent on its book equity, and today's quote assumes it sustains something nearer 10.6 percent.
• Credit is the line to watch rather than revenue: net charge-offs have stepped up in each of the last several quarters to 0.19 percent of average loans annualized, and the quarterly provision rose to 21.4 million dollars.

Bull Case

A bank's competitive advantage is almost never in what it lends. It is in what it pays for the money it lends, and that is a question about customers rather than about credit committees. During 2025 the Federal Reserve lowered its target rate by three-quarters of a point, and the yield F.N.B. earned across its earning assets fell 13 basis points to 5.29 percent. The margin between what it earns and what it pays went up 10 basis points anyway. That outcome is only available to a bank whose depositors are not shopping their balances around, because it requires funding costs to fall faster than asset yields.

The deposit book explains why. About 26 percent of total deposits bear no interest, a proportion held for seven straight quarters, and average deposits reached 38.7 billion dollars in the second quarter of 2026, up 4.1 percent on the year. The annual report describes the source of that stability plainly: "Our diversified and granular deposit base is comprised of business, consumer and municipal customers who we serve within our footprint." Granular is doing real work in that sentence. Ten thousand modest relationships reprice far more slowly than a hundred large ones, and they are considerably harder for a competitor to take away in a single phone call.

On top of that sits a structural choice about how the bank is run. Local bankers make local decisions, but the machinery behind them is shared: the 10-K notes that "we have centralized operations, support and risk functions (e.g., loan operations, treasury and enterprise risk management). The centralization of these processes enables us to maintain consistent quality of these functions and to achieve certain economies of scale." The visible result is operating leverage. Second-quarter revenue reached a record 462.7 million dollars, revenue less operating expense before credit provisions rose 8.8 percent from the prior quarter, and earnings came in at $0.42 a diluted share against $0.36 a year earlier.

Capital is being built and returned at the same time, which is a combination that only works when the underlying business is generating more than it consumes. The common equity tier 1 ratio finished June 2026 at an estimated 11.4 percent against 10.8 percent a year earlier, tangible common equity to tangible assets improved to 8.9 percent from 8.5 percent, and tangible book value per share reached $12.24, up 9.9 percent year over year. The bank still repurchased 2.7 million shares during the quarter, and across the prior fiscal year dividends alone consumed 30.8 percent of earnings. The bear's strongest point is that the return on stated equity remains short of what the price assumes, and that is a fair objection. It is worth noting alongside it that the return on tangible common equity, which measures what the capital actually at work produces, ran at 14 percent in the second quarter.

Bear Case

Bank earnings look their best at a specific point in the interest-rate cycle, and this is roughly that point. When the central bank cuts, deposit costs fall quickly because they are repriced by decision, while loan yields fall slowly because they are repriced by contract. Margins widen in the gap. F.N.B.'s did exactly that through 2025, gaining 10 basis points even as asset yields declined. By the second quarter of 2026 the margin was 3.25 percent, flat against the prior quarter. Flat is where that particular tailwind stops. Cycle-peak earnings and sustainable earnings are the same number right up until they are not.

Credit is drifting in the direction credit always drifts first, which is slowly and from a very low base. Net charge-offs equalled 0.19 percent of average loans annualized in the second quarter of 2026, against 0.18 percent in the first quarter and 0.15 percent a year before, and the provision rose to 21.4 million dollars. Across the full prior year the provision totalled 86.0 million dollars against 79.8 million, which the annual report attributes to loan growth and charge-off activity. None of those figures is alarming in isolation. All of them are moving the same way, and a bank earning a single-digit return on equity has less room to absorb a normal credit cycle than one earning mid-teens.

Look at where the loan growth is coming from and the picture gets less comfortable. Average consumer loans grew 1.1 billion dollars over the year to June 2026 while commercial loans and leases fell 66.7 million. The pattern held through the prior year too: consumer balances rose 8.4 percent, driven largely by residential mortgages, while commercial loans and leases declined 1.1 percent. Commercial lending is where a relationship bank earns its spread and, more importantly, its fee and treasury income. Residential mortgage is the most commoditized asset a bank can hold. Meanwhile the loan-to-deposit ratio rose to 92.5 percent at June 2026 from 90.3 percent three months earlier, so the growth that is happening is drawing down the funding cushion that makes the deposit franchise valuable in the first place.

Then there is what the book value is made of. The shares change hands at roughly one times stated book equity, which sounds undemanding until you notice that around a third of that book is goodwill and other intangibles accumulated through acquisitions. Tangible book value per share stood at $12.24 in June 2026, so against the capital genuinely at risk the shares are closer to one and a half times. The approach built specifically for banks, which values tangible book and then scales it by how far the return on equity sits from the cost of that equity before discounting for credit reserves, lands well under today's quote: the price stands at about twice where it comes out. And the return the price requires, near 10.6 percent, runs meaningfully above the roughly 8.4 percent the bank has recently delivered. The gap is not enormous. It is also not something management can simply decide to close.

Valuation

A bank is worth the return it earns on the capital it is required to hold, which is why the read here comes off book value rather than a multiple of profit. The shares trade at roughly one times stated book equity. To make that arithmetic hold, the market assumes a sustained return on equity of about 10.6 percent, against roughly 8.4 percent recently earned. Everything else in this section is commentary on that two-point difference.

Persistence is not the difficult part of the assumption. Around 74 percent of firms earning a return at that level have gone on to hold it for a decade, so the required return is not historically exotic. The difficulty is distance from this bank's own record, which is where the assumption looks stretched, and the shares sit in the lower half of the peer group on price relative to book while asking for a return their own history has not produced.

The methods split in an informative way. Measured against stated book equity, the asset-based, earnings-power and forward-growth approaches all land near today's quote, which is why nothing here reads as expensive on a conventional screen. The one approach designed for banks disagrees sharply. It starts from tangible book rather than stated book, scales it by the ratio of the return on equity to the cost of that equity, then trims for credit reserves running at roughly 1.25 percent of loans, and the price stands at about twice where it finishes. The entire distance between those two answers is the goodwill sitting on the balance sheet from past acquisitions.

Capital and payout are the right solvency lens for a deposit-funded business, and both look comfortable. The common equity tier 1 ratio ended June 2026 at an estimated 11.4 percent, up from 10.8 percent a year earlier, with tangible common equity at 8.9 percent of tangible assets. Dividends plus buybacks returned about 40 percent of the last full fiscal year's earnings, with dividends alone accounting for 30.8 percent of that. The share count has drifted modestly upward since 2022 because acquisitions were paid for in stock; the 2.7 million shares repurchased in the second quarter of 2026 are the first meaningful move the other way.

Asset quality gives the reader little to worry about today. Non-performing loans and foreclosed property together equalled 0.31 percent of loans at June 2026, total delinquency 0.71 percent, and the allowance covered 1.25 percent of the book. Everything within the bank's control is pointing the correct direction: capital building, tangible book per share compounding near ten percent a year, deposit mix holding. What the price wants on top of all that is roughly two additional points of return on equity, and that is the part the rate cycle and the credit cycle decide rather than management.

Catalysts

The second-quarter print landed on July 16, 2026 and it was the strongest in the recent run. Net income of 148.7 million dollars produced earnings of $0.42 a diluted share, against $0.36 in the same quarter a year earlier and $0.38 in the first quarter of 2026. Revenue reached a record 462.7 million dollars, revenue less operating expense before credit provisions rose 8.8 percent from the prior quarter to 209.4 million, and the net interest margin held at 3.25 percent rather than continuing to expand.

Capital deployment turned visible in the same quarter. The company repurchased 2.7 million common shares for 47 million dollars at a weighted average of 17.46 dollars each, while the estimated common equity tier 1 ratio still finished at 11.4 percent and tangible book value per share rose to $12.24, a gain of 9.9 percent over twelve months. Chief executive Vincent Delie tied the quarter to a technology-led operating model, citing investments in digital capability, data analytics and artificial intelligence intended to deepen household penetration. That is a claim to be checked against the efficiency figures in coming prints rather than accepted on its own.

Two items are worth tracking into the second half. Commercial lending, which had been shrinking, grew 238.6 million dollars on a linked-quarter average basis and helped push total average loans up 6.9 percent annualized, so the mix problem may be turning. Against that, the loan-to-deposit ratio moved to 92.5 percent from 90.3 percent in a single quarter. Faster loan growth funded from a shrinking deposit surplus is exactly how a cheap funding advantage gets spent, and the next two quarters will show whether deposit gathering keeps pace.

Peer Cohorts (Per Segment, With Filing Citations)

Community Banking (reported)

• ZION (ZIONS BANCORPORATION, NATIONAL ASSOCIATION)
• FY2025 10-K: ACL Allowance for Credit Losses Fintech Financial Technology Company AFS Available-for-Sale FRB Federal Reserve Board AI Artificial Intelligence FX Foreign Exchange ALCO Asset Liability Committee GAAP Generally Accepted Accounting Principles ALLL Allowance for Loan and Lease Losses GCF General Collateral Funding Amegy…
• FY2025 10-K: …local authority and accountability, including locally informed pricing and product customization, to maximize customer satisfaction, strengthen community relationships, and improve profitability and shareholder returns. The affiliate banks are supported by an enterprise-level segment-referred to as the "Other"…
• CFR (Cullen/Frost Bankers, Inc.)
• FY2025 10-K: …other community representatives that assist our regional management in responding to local banking needs. Despite this local market, community-based focus, we offer many of the products available at much larger money-center financial institutions. We serve a wide variety of industries including, among others, energy,…
• FY2025 10-K: …of such third parties providing the consumer with financial products or services requested by the consumer. Data required to be made available under the rule includes transaction information, account balance, account and routing numbers, terms and conditions, upcoming bill information, and certain account…
• CBU (COMMUNITY FINANCIAL SYSTEM, INC.)
• FY2025 10-K: .7 million in contingent consideration arrangements. The Company recognized $8.4 million of customer list intangible assets and $2.9 million of goodwill in conjunction with these acquisitions. ​ Segment Information ​ The Company has identified four reportable operating business segments: Banking and Corporate,…
• FY2025 10-K: …No. 001-13695). (2) ​ ​ 10.21 Community Bank System, Inc. 401(k) Employee Stock Ownership Plan, dated as of December 20, 2011. Incorporated by reference to Exhibit 4.5 to the Registration Statement on Form S-8 filed on December 20, 2013 (Registration No. 001-13695). (2) 10.22 Merchants Bancshares, Inc. and…
• WAFD (WAFD, INC.)
• FY2025 10-K: …lending and other general business purposes. In addition to deposits, the Bank derives funds from loan repayments, advances from the Federal Home Loan Bank of Des Moines ("FHLB - DM"), borrowings from the Federal Reserve Bank ("FRB"), and from investment repayments and sales. Loan repayments are a relatively stable…
• FY2025 10-K: …Savings and money market accounts are offered to both businesses and consumers, with interest paid after certain threshold amounts are exceeded. The Bank's deposits are obtained primarily from residents of Washington, Oregon, Idaho, Arizona, Utah, Nevada, New Mexico, California and Texas. Borrowings. The Bank has a…
• FULT (FULTON FINANCIAL CORP)
• FY2025 10-K: …by our website is not a part of this 2025 Annual Report on Form 10-K. Banking and Financial Services Through our banking subsidiary, Fulton Bank, the Corporation delivers financial services primarily within our five-state market area, comprised of Pennsylvania, Delaware, Maryland, New Jersey and Virginia, in a…
• FY2025 10-K: …As the potential impact of climate change broadens, we will continue to assess and respond to climate risks as they evolve. Non-Bank Subsidiaries We own 100% of the outstanding equity of five non-bank subsidiaries, which are consolidated for financial reporting purposes: (i) Fulton Financial Realty Company, which…
• VLY (VALLEY NATIONAL BANCORP)
• FY2025 10-K: …Consumer Banking segments of our business. This level of service and commitment is particularly impactful because of our strong community presence with almost 100 years of service, providing us with a competitive advantage with such customers over certain competitors that are not traditional banks. Overall, our…
• FY2025 10-K: …to 20% of the bank's capital stock and surplus, and (ii) require that all transactions between an insured bank and its affiliates be on terms substantially the same, or at least as favorable, to the bank as those that would be provided to a non-affiliate. In addition, these laws require that an insured bank's loans…
• UBSI (UNITED BANKSHARES INC/WV)
• FY2025 10-K: …of community banking segment assets is reported on the Consolidated Balance Sheets as total assets. The CODM uses net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the community banking segment or into other parts of the entity, such as for…
• FY2025 10-K: …December 31, 2025 includes $5,000,000 to a related interest of a director of the Company. As of December 31, 2025, United expects to recover its remaining investments through the use of the tax credits that are generated by the investments. NOTE X-SEGMENT INFORMATION United operates in one reportable segment,…
• WSFS (WSFS FINANCIAL CORPORATION)
• FY2025 10-K: …experience. ◦ Executing our community banking model that combines stellar experiences with the banking products and services our business Clients demand. ◦ Continuing to grow our NewLane Finance ® leasing business. ◦ Adding seasoned lending professionals that have helped us win clients in our Delaware, southeastern…
• FY2025 10-K: …goal of 36,000 hours of service by providing over 38,000 hours of service to our Communities; • In October, we held our third annual "We Stand for Service Day", during which approximately 1,600 of our Associates provided more than 5,500 hours of service to more than 130 nonprofit and community organizations across…
• CBSH (COMMERCE BANCSHARES, INC.)
• FY2025 10-K: …sheet. The Company's goal is to be the preferred provider of financial services in its communities, based on strong customer relationships built through providing top quality service with a strong risk management culture, and employing a strong balance sheet with strong capital levels. The Company operates under a…
• FY2025 10-K: …statements. Readers should not rely solely on the forward-looking statements and should consider all uncertainties and risks discussed throughout this report. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect…

Wealth Management (reported)

• 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…
• 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…
• 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.…
• 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,…

Insurance (reported)

• AJG (ARTHUR J. GALLAGHER & CO.)
• FY2025 10-K: …operational synergies and develop lower cost structures. In addition, any increase in competition due to new legislative or industry developments could adversely affect us. These developments include: • Increased capital-raising by underwriting enterprises, which could result in new risk-taking capital in the…
• FY2025 10-K: …firms and professional employer organizations; and • Third-party capital providers entering the insurance and reinsurance risk transfer market offering products and capital directly to our clients. Their presence in the market has increased the competitive pressures that we face. New competition as a result of these…
• BRO (BROWN & BROWN, INC.)
• FY2025 10-K: …in the United States, Belgium, Canada, France, Germany, Hong Kong, Italy, Malaysia, the Netherlands, Singapore, United Arab Emirates and the United Kingdom. Competition The insurance intermediary business is highly competitive, and numerous firms actively compete with us for customers and insurance markets.…
• FY2025 10-K: …funds and shared market mechanisms, and restricting payment of dividends. Also, in response to perceived excessive cost or inadequacy of available insurance, states have from time to time created state insurance funds and assigned risk pools, which compete directly, on a subsidized basis, with private insurance…
• RYAN (RYAN SPECIALTY HOLDINGS, INC.)
• FY2025 10-K: …markets that may give them an advantage over us. Other competitive concerns may include the quality of our products and services, our pricing and the ability of some of our clients to self-insure, and the entrance of technology companies into the insurance intermediary business. A number of insurance companies are…
• FY2025 10-K: …prevent former employees from using their knowledge of our business and operations to compete with us could be limited. Our business may be harmed if we lose our relationships with retail brokers, insurance carriers, or other trading partners, we fail to maintain good relationships with retail brokers, insurance…
• GSHD (GOOSEHEAD INSURANCE, INC.)
• FY2025 10-K: …closely correlated with employment levels, corporate revenue, and asset values. In addition, an increase in client preference for car- and ride-sharing services, as opposed to automobile ownership, may result in a long-term reduction in the number of vehicles per capita, and consequently the automobile insurance…
• FY2025 10-K: S. and around the world moving us toward a low-carbon economy, which could create new competitive pressures around innovative insurance solutions; and • Increased competition from new market participants such as banks, accounting firms, consulting firms, and Internet or other technology firms offering risk management…
• BWIN (The Baldwin Insurance Group, Inc.)
• FY2025 10-K: …terminate their respective arrangements with us or in the case of material financial impairment of such insurance company partners, we could be forced to move our business to other insurance company partners and additional expense and loss of market share could possibly result. Our business may be harmed if we lose…
• FY2025 10-K: …of a client. 23 We actively compete with numerous integrated financial services organizations as well as insurance company partners and brokers, producer groups, individual insurance agents, investment management firms, independent financial planners and broker-dealers. Competition may reduce the fees that we can…
• AON (Aon plc)
• FY2025 10-K: …consists of commissions paid to us out of the premiums that insurers and reinsurers charge our clients for coverage. We have no control over premium rates, and our revenues and profitability are subject to change to the extent that premium rates fluctuate or trend in a particular direction. The potential for changes…
• FY2025 10-K: …banks, or otherwise) have caused in the past and may in the future cause reductions in technology and discretionary spending by our clients, which may result in reductions in the growth of new business or reductions in existing business. If our clients become financially less stable, enter bankruptcy, liquidate their…

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.