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

At today's price, FNB CORP/PA/ (FNB) is priced for 10.6% return on equity. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/FNB

Headline

FieldValue
TickerFNB
CompanyFNB CORP/PA/
Current price$18.96/sh
CompositionCommunity Banking 94% / Wealth Management 5% / Insurance 1%

What The Price Requires (Inversion)

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

FieldValue
Inversion basisfinancials
Return on equity needed10.6%
Return on equity now8.4%
ROE gap+2.2pp
Price-to-book0.99x

Solve inputs: computed at a 10.6% cost of equity with 4% terminal growth over a 5-year stage, on common book equity (FY2026); each 1pp of cost of equity moves the implied ROE ~1pp.

Reconcile: at the x-ray's 9.3% required return this reads ~9.2%; the models below use their own rates.

How unusual the bet is: elevated

ReferenceValue
vs own history+2.77σ
cohort percentile (of 119 peers)6
sustained it ~10 years at this level74%
implied end-window share0%

Valuation X-Ray

The price is supported by asset-based and earnings-power and relative-multiple 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.

FamilyMedian price/FVModelsReads
Asset1.08x3expensive
Earnings0.72x2justifies
Relative0.41x3justifies
Growth1.10x3expensive

Families that justify the price: Asset, Earnings, Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.2%); the inversion above states its own rate.

Per-Model Detail (n=11)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth——no—
Bank Fair Value (P/TBV)—$9.502.00xyesTBVPS $11.90 × 0.80x (ROE (TTM) 8.6% / CoE 9.3%, g=5.0% (sustainable: 65% retention × ROE, 5% cap; not the terminal-growth assumption), credit 1.28% allowance/loans → ×0.94)
Relative ValuationRelative$18.101.05xyesP/E 10x (static sector reference · 2026-04), scenarios: 8.3x / 10.0x / 11.7x (bear / base = reference held flat / bull), EV/EBITDA N/Ax
Simple DDMGrowth$79.980.24xyesDPS $0.48, g=8.6% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3%
Two-Stage DDMGrowth$16.931.12xyesStage 1: 20% for 5yr, Stage 2: 3.5% perpetual
Simple Excess ReturnAsset$17.561.08xyesBV/sh $18.88, ROE (TTM) 8.6%, ke 9.3%
Two-Stage Excess ReturnAsset$16.931.12xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$17.301.10xyesRev $1.4B, growth 12% (input: historical growth; tapered), Terminal P/S: 4.0x / 4.8x / 5.6x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair ValueRelative$45.730.41xyesEPS $1.62, growth 28% (input: historical EPS growth), PEG=0.41 (Undervalued)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings——no—
Residual IncomeAsset——no—
Graham NumberAsset$26.230.72xyes√(22.5 × EPS $1.62 × BVPS $18.88) — Graham's conservative floor
EV/EBITDA RelativeRelative——no—
FCF YieldEarnings——no—
SBC-Adj FCF YieldEarnings——no—
Ben Graham FormulaEarnings$52.270.36xyesEPS $1.62 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset——no—
P/Sales SectorRelative——no—
PEG Fair ValueRelative$60.750.31xyesEPS $1.62 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings YieldEarnings$17.511.08xyesEPS $1.62 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Share count CAGR (dilution)0.8%

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

F.N.B. Corp is a mature regional bank, and a mature bank is best read off the price you pay for its book value. At about $18.23 the stock trades near book value of $18.88 a share, roughly 1 times book, the price the market typically pays for a steady, fully-priced regional.

Read backward, the price assumes the bank earns a return on equity of about 10.4%, modestly above the roughly 8.4% it has earned recently. That is the elevated part of the bet: the price requires a step up in profitability that the bank has not yet sustained, even though recent results are moving in that direction.

The trajectory supports the optimism for now. Net interest margin expanded to 3.25%, earnings per share rose about 19% year over year, loans and deposits are growing, and the bank raised its dividend 8% and authorized a buyback. The question the valuation asks is whether the improving returns hold or fade back toward the historical average.

Bull Case

F.N.B. Corp should be read as what it is: a mature, well-run regional bank, and that framing sets the right expectations. A mature bank is not a growth stock; it is a spread-and-fee business whose value comes from earning a steady return on its capital and compounding book value over time. F.N.B. does this across a Mid-Atlantic and Southeastern footprint, anchored in Pittsburgh, with community banking at about 94% of the mix plus smaller wealth-management and insurance arms. At roughly 1 times book value of $18.88 a share, the price is paying for that steady franchise without demanding a premium, which is a reasonable starting point for a bank that is improving its profitability.

The recent results show the profitability inflecting upward. In the first quarter of 2026 net income available to common shareholders rose to $137 million from $116.5 million, earnings per share grew about 19% year over year to $0.38, and net interest income increased about 11% to $359.3 million. The most important line for a bank is the margin, and it expanded: net interest margin rose 22 basis points to 3.25%, helped by lower interest-bearing deposit costs and growth in earning assets. The filing's spread disclosure shows the same direction, with net interest margin moving up year over year and net interest spread widening to 2.38% [FY2025 10-K, accession 0000037808-26-000007]. A widening spread on a growing balance sheet is the cleanest way a bank improves its return on equity.

The capital and credit picture supports the case and the shareholder returns. Loans grew about 4% annualized with robust commercial-and-industrial demand from investment-grade borrowers, deposits grew, and credit stayed contained with net charge-offs around 18 basis points. Management raised the quarterly dividend 8% to $0.13 a share and authorized a new $300 million buyback, the kind of capital return a bank makes when it is confident in its capital position and earnings. With net interest income guided to $1.495 billion to $1.535 billion for the year and the margin expected to keep rising, the bull case is simply that F.N.B.'s return on equity climbs toward the roughly 10.4% the price assumes, justifying the price-to-book.

Bear Case

The bear case for a regional bank is almost always about the external variables it cannot control, and for F.N.B. the variable with the most leverage is interest rates. The bank's earnings come from the spread between what it earns on loans and securities and what it pays on deposits, and that spread is at the mercy of the rate environment and competition for deposits. The filing makes the sensitivity concrete: in a prior period the yield on earning assets "decreased 13 basis points to 5.29%, driven by a 19 basis point decline in yields on loans" even as deposit costs shifted [FY2025 10-K, accession 0000037808-26-000007]. If the rate path turns unfavorable, or if deposit competition forces F.N.B. to pay up to keep funding, the margin expansion that is driving the current earnings growth can reverse quickly, and with it the return-on-equity improvement the price is counting on.

The valuation already assumes the better outcome. The price pays roughly 1 times book and implies a sustained return on equity around 10.4%, while the bank has recently been earning closer to 8.4%. The framework flags this as elevated: the assumed return runs above what F.N.B. has actually delivered, and only a portion of banks earning this return have sustained it for a decade. The conservative methods reflect that gap. In other words, the price is not cheap for this bank; it is fair-to-full and leans on continued improvement.

Commercial real estate is the credit overhang that regional banks cannot escape. F.N.B. carries meaningful CRE exposure, with concentration around 194% of Tier 1 capital plus allowance, and management has described CRE as a continued headwind as projects move into the secondary market. The filing details a quarterly credit-rating and probability-of-default process used "to estimate the likelihood that a borrower will cease making payments as agreed" [FY2025 10-K, accession 0000037808-26-000007], which is the machinery for catching deterioration, but the risk is real: a softening in commercial property values across its footprint would drive provisions higher and pull return on equity down, away from the level the price assumes. A mature regional trading at full book value with an elevated implied return and a CRE-heavy book has limited cushion if the macro turns.

Valuation

F.N.B. is valued the way a bank should be, off the price you pay for its book value rather than an operating multiple, because a bank is worth the return it earns on its capital. At about $18.23 (June 27, 2026) the stock trades near book value of $18.88 a share, a price-to-book of roughly 0.95, which sits in the lower half of where its peer group trades. Read backward, that price implies the bank sustains a return on equity of about 10.4%, against the roughly 8.4% it has earned recently. The implied return runs above its own record, which is why the framework reads the priced-in assumption as elevated.

The X-ray, restricted to the methods that make sense for a bank, brackets the price. The asset-based excess-return frames land near $17, just below the price, and the relative method on a sector earnings multiple lands near the price at about $18. The dividend-discount and earnings-yield frames bracket it depending on the growth assumption. The dispersion says the price is fair-to-full for a bank earning what F.N.B. earns today.

The honest synthesis is that this is an asset-and-earnings-supported valuation that requires the profitability improvement to continue. The recent margin expansion and double-digit earnings growth are genuine, and if return on equity climbs toward the implied 10.4%, the price-to-book is justified and the dividend and buyback add to the return. But the price already gives credit for that improvement, the implied return sits above the historical average, and the CRE and rate sensitivities are the risks that could pull the return back toward the level where the conservative methods sit below the price.

Catalysts

The most recent catalyst was the first-quarter 2026 earnings report, which met estimates and showed clear momentum. F.N.B. reported earnings of $0.38 a share, up about 19% year over year, net income available to common of $137 million, net interest income of $359.3 million up about 11%, and a net interest margin that expanded 22 basis points to 3.25%. Average deposits grew 3.8% and average loans 2.5%, with the loan-to-deposit ratio at a comfortable 90.3%. Management guided second-quarter net interest income to $370 million to $380 million and full-year net interest income to $1.495 billion to $1.535 billion, with the margin expected to keep rising.

Capital return is a fresh, concrete catalyst. The board raised the quarterly dividend 8% to $0.13 a share and authorized a new share repurchase program with $300 million available, signaling confidence in the capital position. Continued execution on buybacks and any further dividend action are positive drivers, while loan and deposit pipeline conversion, both described as near record levels, is the growth engine to watch.

The swing factors are macro and credit. The interest-rate path is the dominant external variable, since it sets the margin trajectory the earnings story depends on. Commercial real estate remains a watch item, with concentration around 194% of Tier 1 capital plus allowance and continued secondary-market payoffs, so credit migration in the CRE book is the key risk to monitor. Analyst sentiment has been improving, with upgrades to buy and a moderate-buy consensus citing strong capital, asset growth, and resilient credit quality.

Sources: F.N.B. Q1 2026 earnings, PRNewswire; F.N.B. Q1 EPS jumps 19%, StockTitan; F.N.B. Q1 earnings meet estimates, Yahoo Finance; F.N.B. dividend hike and buyback, Simply Wall St; F.N.B. Q1 2026 earnings release 8-K, SEC.

Peer Cohorts (Per Segment, With Filing Citations)

Community Banking (reported)

Wealth Management (reported)

Insurance (reported)

Methodology Note

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.

View the full interactive FNB report on boothcheck