FULTON FINANCIAL CORP (FULT): what the price assumes

In the published model solve dated 2026-Q2, anchored at $23.69, FULTON FINANCIAL CORP (FULT) is priced for 11.7% 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: 2026-08-31 · Source: https://boothcheck.com/report/FULT

Headline

What The Price Assumes (Inversion)

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

Solve inputs: computed at a 10.1% 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 5.0%); 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

• Growth here arrives by purchase rather than by origination: Blue Foundry Bancorp closed on April 1, 2026 and pushed net loans up $1.7 billion in a single quarter to $25.9 billion, while everything the existing franchise originated added $102.6 million.
• Credit and funding are both drifting the wrong way, with annualized net charge-offs running 0.34% of average loans in the second quarter of 2026 against 0.25% the quarter before, and non-interest-bearing demand deposits falling $118.5 million outside the acquisition while brokered deposits rose $257.4 million.
• Blue Foundry Bank merged into Fulton Bank on July 11, 2026, which makes the next two quarterly reports the first clean read on whether the enlarged bank holds its reported 3.60% margin once integration costs stop landing.

Bull Case

A community bank's edge is never in the lending. Anyone with capital can make a loan. The edge sits in the money it lends with: deposits from households and small businesses that stay put through a rate cycle and therefore cost less than what a rival pays for wholesale funding. The latest 10-Q describes the shape of the thing plainly, noting that The Corporation is a financial holding company, which, through its wholly owned banking subsidiary, provides a full range of consumer and commercial financial services in Pennsylvania, Delaware, Maryland, New Jersey and Virginia. Behind that sentence sit more than 215 branches and $28.3 billion of deposits.

The funding edge showed up clearly in the first quarter of 2026. The rate paid on average interest-bearing liabilities fell 38 basis points against the same quarter a year earlier, while the yield collected on loans gave up only 16 basis points, to 5.70%. When funding reprices downward faster than assets do, the spread widens without anyone having to be clever about it. Net interest income reached $262.0 million for the quarter, up from $251.2 million a year earlier. Non-interest income added a further $69.8 million. The second quarter carried it further, to a reported margin of 3.60%, two basis points better than the quarter before.

Fee income is the second leg, and it is broader than a branch count suggests. The annual report attributes a $4.8 million rise in cash management fees to customers moving balances into interest-bearing accounts, a $3.6 million rise in mortgage banking income to higher loan volumes and spreads, and a $1.8 million rise in SBA income. None of those lines is enormous by itself. Together they are why net interest income accounted for 79% of total revenues in 2025 rather than all of it, and the remaining fifth does not depend on the shape of the yield curve.

Then there is the thing Fulton has actually proven it can do, which is buy a bank and digest it. Average deposits rose $3.4 billion, or 16.0%, in the Republic First year, roughly $3.7 billion of that assumed directly in the transaction. Absorbing two institutions inside two years while the reported margin rises is an operating capability, and it does not appear in any ratio on the page.

Capital policy points the same direction. Common equity tier 1 capital stood near 11.8% as filed at the end of 2025 and around 12.1% at June 30, 2026 on preliminary figures, with roughly 52% of earnings returned as dividends plus buybacks. During the second quarter the company retired 525,000 of its own shares for $11.1 million, an average of 21.19 dollars each, and the diluted count fell to about 181.7 million from 184.1 million a year earlier. Management was buying below where the stock now changes hands, which is the rarer kind of repurchase: an investment rather than a payroll offset.

The bull has to concede that almost none of this is organic. Strip the acquisition out of the second quarter and the underlying loan book added $102.6 million. The answer is that in a fragmented five-state market full of subscale lenders, buying well is itself the growth engine, and this management has now run that play twice without breaking anything visible.

Bear Case

The thing being competed away is the deposit franchise, and it is happening in the detail rather than the headline. Take Blue Foundry out of the second quarter and deposits still grew, by $249.2 million. Then look at what grew. Brokered deposits, the most rented money a bank can hold, rose $257.4 million. Savings added $189.4 million and time deposits $76.4 million. Against that, non-interest-bearing demand deposits, the cheapest funding in banking and the closest thing a community lender has to a moat, fell $118.5 million, and interest-bearing demand fell a further $155.6 million. The balance sheet grew. The quality of the funding behind it did not.

The annual report names the mechanism without flinching: Factors, including competition with bank and non-bank competitors, changes in interest rates, the availability of alternative investment options, customer confidence in the industry and the liquidity needs of deposit customers, can cause fluctuations in both the level and cost of customer deposits. Every deposit-funded lender writes some version of that paragraph. It reads differently when the mix is moving the way this one is moving.

Which brings the argument to what is being asked of the business. About 1.4 times book value is not a demanding multiple for a bank in the abstract. It is demanding for this bank. Fulton earns a return on equity of roughly 11.6% today, and across the eighteen years of record behind it that figure has averaged 8.3%. To support the current multiple of book the required return runs beyond the ceiling that even the strongest institutions have held over four decades of data, and of the firms that ever reached that level of return, only about 67% were still holding it a decade later. If the return does not arrive, the multiple does not stay. A bank earning no more than the return its owners demand is worth its book value, and the distance between here and there is essentially the whole premium.

Credit is the second pressure, and the direction has turned. Annualized net charge-offs ran 0.34% of average loans in the second quarter against 0.25% in the first. Non-performing assets reached $187.1 million, or 0.54% of total assets. The allowance now covers 1.48% of net loans against 1.51% three months earlier, a dilution that comes mostly from folding in a book someone else underwrote. No single one of those levels is alarming. The arithmetic of the direction is: half a percentage point of extra loss on a $25.9 billion loan book costs more than the entire year-over-year gain in net interest income the bank just booked. On how those loans get graded in the first place, the annual report is admirably direct: Assigning risk ratings involves judgment. True everywhere. It carries more weight at a lender that has just absorbed two loan books it did not write.

Third, the growth is bought and the currency is partly stock. The share count has risen about 2.9% a year since early 2022, which is what paying for banks with equity looks like on a multi-year view. The second quarter carried $11.2 million of acquisition-related expense, a $2.1 million charge for merging two employee pension plans and $0.8 million of extinguishment costs on the notes retired in June. Each transaction arrives with a bill attached, and there is no reason to think the next one will not.

The fair concession is that buybacks are running below the current quote and the reported margin has widened through two integrations. But strip the acquisitions out of the second quarter and the underlying business added $102.6 million of net loans, with commercial lending shrinking $104.3 million inside that total. The franchise that is supposed to earn a premium to book is, at the moment, not growing. Its own risk disclosure explains why that is hard to fix: Many of our competitors offer the same banking services that we offer and our success depends on our ability to adapt our products and services to evolving industry standards and customer preferences. A lender whose products match everyone else's competes on rate and on service. Rate is a margin problem. Service does not travel easily through an acquisition.

Valuation

Paying about 1.4 times book value for a bank is a statement about future returns, not about the assets sitting on the balance sheet today. Book value is what the owners have already put in and left in. Anything above it is a wager that the bank will earn more on that capital than the owner could earn elsewhere at comparable risk, and will keep earning it long enough to matter.

That wager does not resolve into a comfortable number here. Fulton has recently been earning a return on equity of about 11.6%. Supporting today's multiple of book requires a return beyond the ceiling that even the strongest banks have sustained across four decades of record, which is another way of saying no return on equity the historical record contains is quite enough to get there. Among firms that did reach that level, only about 67% were still holding it ten years on.

And yet the methods that value the bank directly do not read it as expensive. Book value plus profitability lands essentially where the stock trades. The earnings-power methods land above. Peer multiples land well above, though they reach that answer by carrying forward an earnings growth rate produced by buying two banks rather than by the existing franchise, and that is not a rate anyone should extrapolate. The one place the stock sits above the methods is the forward-growth family, by roughly 14%.

So what separates the two readings? The return an owner insists on earning. Demand something north of ten percent a year from a lender with this balance sheet and the multiple looks unsupportable. Demand a point less and it looks ordinary. That is not a modelling quirk. It is the actual question a buyer of this stock is answering, and no arithmetic settles it for them.

Against its own cohort the stock sits in the upper half of the peer group on book value, and the growth that would defend that position is not visible in the base business. Revenue expanded 11.5% at WBS and 11.4% at CATY over the same trailing period, with VLY at 9.7% and BANR at 8.6%; Fulton's own expansion arrived through two purchases, and outside them the second-quarter loan book barely moved.

For a deposit-funded lender the downside floor is regulatory capital and payout capacity rather than a cash pile. Common equity tier 1 stood near 11.8% as filed at the end of 2025 and around 12.1% at June 30, 2026 on preliminary numbers, comfortably above requirement, with about 52% of earnings going back out as dividends and repurchases and a diluted share count that has fallen year over year. That is a bank with room to absorb a credit cycle. What it does not obviously have is the return profile the multiple is asking it to produce.

Catalysts

Second-quarter results landed on July 22, 2026, and they were the first to carry Blue Foundry. Net income available to common shareholders came to $99.9 million for the three months, $7.7 million better than the first quarter, with net interest income up $22.2 million to $284.3 million, of which $17.5 million was attributable to the acquired bank. The reported margin held at 3.60%. Provision expense fell to $4.9 million from $14.4 million, while the allowance still rose in dollar terms because the acquired loan book brought $31.0 million of its own.

The integration is now complete on paper. Blue Foundry Bank merged into Fulton Bank on July 11, 2026, ending the two-charter arrangement that had run since the April 1 close and consolidating the branch networks under one national bank. The funding stack was reshaped at the same time: $300.0 million of 5.950% subordinated notes due 2036 were issued on May 5, 2026, and $195.0 million of 3.250% notes due 2030 were redeemed on June 15, 2026, with the extinguishment cost booked in the quarter. Common equity tier 1 finished the period around 12.1% on preliminary figures.

Two things are worth watching from here. The 2026 repurchase authorization runs to January 31, 2027 and permits up to $150 million, of which $35.6 million had been used by June 30, including the 525,000 shares bought during the second quarter. And the third-quarter report will be the first without acquisition-related expense distorting the comparison, which makes it the cleanest available look at whether the enlarged deposit base holds its cost advantage now that the two banks run on one charter.

Peer Cohorts (Per Segment, With Filing Citations)

Community Banking (single reportable segment) (reported)

• FRME (FIRST MERCHANTS CORP)
• FY2025 10-K: 1893. The Bank also operates First Merchants Private Wealth Advisors (a division of First Merchants Bank). The Bank includes 111 banking locations in Indiana, Ohio, and Michigan. In addition to its branch network, the Corporation offers comprehensive electronic and mobile delivery channels to its customers. The…
• FY2025 10-K: …credit losses and salaries and employee benefits are the significant expenses in the banking operations. The CODM evaluates performance, allocates resources and makes key operating decisions based on consolidated net income that is reported in the Consolidated Statements of Income. The measure of segment assets is…
• TCBK (TriCo Bancshares)
• FY2025 10-K: :ConsumerPortfolioSegmentMember tcbk:SFR141stDTLiensMember tcbk:FarmlandMember 2025-12-31 0000356171 us-gaap:ConsumerPortfolioSegmentMember tcbk:SFR141stDTLiensMember tcbk:SFRFirstDeedMember 2025-12-31 0000356171 us-gaap:ConsumerPortfolioSegmentMember tcbk:SFR141stDTLiensMember tcbk:SFRSecondDeedMember 2025-12-31…
• FY2025 10-K: …us-gaap:HomeEquityLoanMember tcbk:MultifamilyCollateralMember 2024-12-31 0000356171 us-gaap:ConsumerPortfolioSegmentMember us-gaap:HomeEquityLoanMember tcbk:FarmlandMember 2024-12-31 0000356171 us-gaap:ConsumerPortfolioSegmentMember us-gaap:HomeEquityLoanMember tcbk:SFRFirstDeedMember 2024-12-31 0000356171…
• 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: Community Reinvestment Under the CRA, as implemented and overseen by federal banking regulators, an insured depository institution has a continuing and affirmative obligation consistent with its safe and sound operation to help meet the credit needs of its entire community, including low- and moderate-income…
• WSFS (WSFS FINANCIAL CORPORATION)
• 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…
• FY2025 10-K: …post-retirement benefits and income tax expense. All significant intercompany accounts and transactions were eliminated in consolidation. 72 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SIGNIFICANT ACCOUNTING POLICIES Cash, Cash Equivalents and Restricted Cash For purposes of reporting cash flows, cash, cash…
• CVBF (CVB FINANCIAL CORP.)
• FY2025 10-K: …approvals, and other customary closing conditions. Business Segments We are a community bank with one reportable operating segment. See Note 3 - Summary of Significant Accounting Policies - Business Segments of the notes to the consolidated financial statements. Human Capital We employed 1,079 associates as of…
• FY2025 10-K: …cvbf:LoansExcludingPurchasedCreditImpairedLoansMember us-gaap:FairValueMeasurementsNonrecurringMember cvbf:OtherRealEstateOwnedMember 2025-12-31 0000354647 us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember us-gaap:ConsumerOtherMember 2024-12-31 0000354647…
• BANR (Banner Corporation)
• FY2025 10-K: …has concluded that there was no impairment of the FHLB stock investment as of December 31, 2025 and 2024. Loans Receivable : The Bank originates one- to four-family residential loans for both portfolio investment and sale in the secondary market. The Bank also originates construction and land development, multifamily…
• FY2025 10-K: 33 $ 39,383 1.55 % $ 2,233,902 $ 33,113 1.48 % $ 1,921,326 $ 13,334 0.69 % Savings accounts 3,576,179 76,733 2.15 % 3,231,631 71,225 2.20 % 2,674,936 27,739 1.04 % Money market accounts 1,487,141 30,314 2.04 % 1,632,092 35,206 2.16 % 1,908,983 24,089 1.26 % Certificates of deposit 1,517,967 54,368 3.58 % 1,514,726…
• CATY (Cathay General Bancorp)
• FY2025 10-K: …policies. The measure of segment assets is reported on the balance sheet as total assets. The Company's operations primarily consist of commercial banking services, servicing primarily the individuals, professionals, and small to medium-sized businesses in the local markets in which its branches are located. Its…
• FY2025 10-K: …Bank's deposits are generally obtained from residents within its geographic market area. The Bank utilizes traditional marketing methods to attract new clients and deposits, by offering a wide variety of products and services and utilizing various forms of advertising media. From time to time, the Bank may offer…
• WBS (WEBSTER FINANCIAL CORPORATION)
• FY2025 10-K: …development projects provide a return primarily through the realization of tax benefits. The Company applies the proportional amortization method to account for its investments in qualified affordable housing projects. Investment in Federal Home Loan Bank and Federal Reserve Bank Stock The Bank is a member of the…
• FY2025 10-K: , foreclosed property expense, other-non interest expense, allocated net operating costs, and allocated total support costs. (3) Intangible assets amortization, which is a component of other non-interest expense presented in Other segment items, was $ 10.7 million for Commercial Banking, $ 14.0 million for Healthcare…

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.