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Orrstown Financial Services (ORRF)

With $2.8 billion in assets, Orrstown Financial Services, Inc. and its wholly-owned subsidiary, Orrstown Bank, provides a wide range of consumer and business financial services through banking offices in Berks, Cumberland, Dauphin, Franklin, Lancaster, Perry, and York Counties, Pennsylvania and Anne Arundel, Baltimore, Howard, and Washington Counties, Maryland, as well as Baltimore City, Maryland. Orrstown Bank is an Equal Housing Lender and its deposits are insured up to the legal maximum by the FDIC. Orrstown Financial Services, Inc.’s common stock is traded on Nasdaq (ORRF).

ORRF stock data

Investment data

Data from SEC filings
Securities sold
Number of investors
Top 50 of 67 long holdings
End of quarter 31 Mar 22
Value
 
#Shares
 
Prev Q
 
Change
%, QoQ
$4.72M 29.06K 45.72K -36.4
$2.44M 7.93K 8.06K -1.7
$1.94M 11.13K 11.73K -5.2
$1.62M 581 697 -16.6
$1.51M 6.99K 12.55K -44.4
$1.49M 2.93K 3.11K -5.9
$1.43M 6.46K 6.49K -0.5
$1.22M 2.67K 2.8K -4.7
$1.16M 6.18K 6.71K -8.0
$1.14M 6.42K 6.74K -4.7
$1.13M 2.56K 2.59K -0.9
$1.05M 19.29K 56.94K -66.1
$984K 3.6K 4.51K -20.1
$977K 5.35K 5.45K -1.8
$941K 7.95K 8.28K -4.0
$925K 3.09K 3.25K -4.8
$907K 6.65K 7.15K -7.0
$903K 3.39K 3.8K -10.6
$898K 5.37K 6.37K -15.7
$885K 2.48K 2.52K -1.9
$874K 268 249 +7.6
$866K 3.17K 3.29K -3.5
$830K 11.48K 13.02K -11.8
$808K 5.84K 6.48K -9.9
$782K 5.93K 7.11K -16.6
$753K 12.43K 13.44K -7.5
$753K 5.89K 6.07K -3.0
$733K 4.5K 5.4K -16.7
$712K 7.83K 7.84K -0.1
$677K 1.65K 1.9K -13.2
$668K 6.6K 7.63K -13.4
$654K 4.28K 4.63K -7.6
$652K 4.76K 5.74K -17.1
$648K 6.39K 6.58K -3.0
$637K 2.58K 2.93K -12.1
$604K 2.85K 3.52K -19.0
$592K 7.22K 7.22K 0
$581K 4.61K 5.43K -15.2
$576K 1K 1.51K -33.7
$565K 2.76K 3.49K -21.0
$559K 4.81K 6.14K -21.6
$549K 11.73K 13.7K -14.4
$547K 3.67K 4.3K -14.5
$546K 10.73K 11.76K -8.8
$541K 2.24K 2.24K +0.1
$541K 7.85K NEW
$540K 1.56K 1.56K 0
$497K 6.02K 7.34K -18.0
$494K 3.12K 4.95K -37.0
$473K 2.21K 2.08K +6.3
Holdings list only includes long positions. Only includes long positions.

Calendar

5 May 22
26 Jun 22
31 Dec 22
Quarter (USD) Mar 22 Dec 21 Sep 21 Jun 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Dec 21 Dec 20 Dec 19 Dec 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Cash burn rate (est.) Burn method: Change in cash Burn method: Operating income Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 214.24M 214.24M 214.24M 214.24M 214.24M 214.24M
Cash burn (monthly) (no burn) 9.33M (no burn) (no burn) (no burn) (no burn)
Cash used (since last report) n/a 26.83M n/a n/a n/a n/a
Cash remaining n/a 187.4M n/a n/a n/a n/a
Runway (months of cash) n/a 20.1 n/a n/a n/a n/a

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
22 Jun 22 Zullinger Joel R Orrstown Financial Services, Inc, Common Stock Sell Dispose S No No 24.92 350 8.72K 40,653
17 May 22 Longenecker Thomas D Orrstown Financial Services, Inc, Common Stock Buy Acquire P No No 23.96 70 1.68K 12,961
27 Apr 22 Snoke Glenn W Orrstown Financial Services, Inc. Common, Restricted Stock Grant Acquire A No No 0 1,000 0 4,499
27 Apr 22 Keller Mark K Orrstown Financial Services, Inc. Common, Restricted Stock Grant Acquire A No No 0 1,000 0 4,499
44.5% owned by funds/institutions
13F holders Current Prev Q Change
Total holders 71 70 +1.4%
Opened positions 7 9 -22.2%
Closed positions 6 4 +50.0%
Increased positions 18 23 -21.7%
Reduced positions 26 22 +18.2%
13F shares Current Prev Q Change
Total value 112.79M 256.85M -56.1%
Total shares 4.92M 4.88M +0.8%
Total puts 0 0
Total calls 0 0
Total put/call ratio
Largest owners Shares Value Change
BLK Blackrock 710.08K $16.28M -2.9%
Vanguard 522.93K $11.99M -0.2%
FMR 436.96K $10.02M +8.2%
Dimensional Fund Advisors 347.4K $7.97M +6.2%
Fourthstone 310.24K $7.11M +22.2%
Renaissance Technologies 242.8K $5.57M -1.7%
Pacific Ridge Capital Partners 210.84K $4.84M +8.7%
STT State Street 205.59K $4.71M -0.1%
Endeavour Capital Advisors 195.23K $4.48M 0.0%
Geode Capital Management 187.59K $4.3M +3.9%
Largest transactions Shares Bought/sold Change
Fourthstone 310.24K +56.27K +22.2%
FMR 436.96K +33.24K +8.2%
Context BH Capital Management 37.02K +22.86K +161.4%
Cornercap Investment Counsel 0 -22.3K EXIT
BLK Blackrock 710.08K -20.98K -2.9%
Dimensional Fund Advisors 347.4K +20.17K +6.2%
Parametric Portfolio Associates 15.11K -19.12K -55.9%
SEIC SEI Investments 0 -18.07K EXIT
Pacific Ridge Capital Partners 210.84K +16.91K +8.7%
Millennium Management 15.27K +15.27K NEW

Financial report summary

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Risks
  • If our allowance for loan losses is not sufficient to cover actual losses, our earnings would decrease.
  • Commercial real estate lending may expose us to a greater risk of loss and impact our earnings and profitability.
  • Our loan portfolio has a significant concentration in commercial real estate loans.
  • The credit risk related to commercial and industrial loans is greater than the risk related to residential loans.
  • Environmental liability associated with our lending activities could result in losses.
  • As a participating lender in the SBA Paycheck Protection Program (“PPP”), we are subject to additional risks of litigation from our clients or other parties regarding our processing of loans for the PPP and risks that the SBA may not fund some or all PPP loan guaranties.
  • Changes in interest rates could adversely impact the Company’s financial condition and results of operations.
  • Our securities portfolio performance in difficult market conditions could have adverse effects on our results of operations.
  • Potential downgrades of U.S. government securities by one or more of the credit ratings agencies could have a material adverse effect on our operations, earnings and financial condition.
  • The expected discontinuance of LIBOR presents risks to the financial instruments originated, issued or held by us that use LIBOR as a reference rate.
  • If we cannot replace interest income on PPP loans, our net income would be adversely affected.
  • Difficult economic and market conditions can adversely affect the financial services industry and may materially and adversely affect the Company.
  • Because our business is concentrated in south central Pennsylvania, the greater Baltimore region, and Washington County, Maryland, our financial performance could be materially adversely affected by economic conditions and real estate values in these market areas.
  • Competition from other banks and financial institutions in originating loans, attracting deposits and providing other financial services may adversely affect our profitability and liquidity.
  • Our business may be adversely affected if we fail to adapt our products and services to technological advances, evolving industry standards and consumer preferences.
  • The Company’s business strategy includes the continuation of moderate growth plans, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively.
  • We may incur significant losses as a result of ineffective risk management processes and strategies.
  • We face security risks, including denial-of-service attacks, hacking, social engineering attacks targeting our colleagues and clients, malware intrusion or data corruption attempts, and identity theft that could result in the disclosure of confidential information, adversely affect our business or reputation, and create significant legal and financial exposure.
  • Cybersecurity and data privacy are areas of heightened legislative and regulatory focus.
  • We may not be able to successfully implement future information technology system enhancements, which could adversely affect our business operations and profitability.
  • We may become subject to claims and litigation pertaining to fiduciary responsibility.
  • Climate change may adversely affect our business and results of operations.
  • Growing by acquisition involves risks.
  • We may be unable to successfully integrate the operations of acquired entities over time.
  • The market price of our common stock after acquisitions may be affected by factors different from those affecting our shares currently.
  • Governmental regulation and regulatory actions against us may impair our operations or restrict our growth.
  • Altering our overdraft fee practices could materially adversely affect the Company’s fee income and results of operations.
  • Increases in FDIC insurance premiums may have a material adverse effect on our results of operations.
  • Legislative, regulatory and legal developments involving income and other taxes could materially adversely affect the Company’s results of operations and cash flows.
  • The Company is required to use judgment in applying accounting policies and different estimates and assumptions in the application of these policies could result in a decrease in capital and/or other material changes to the reports of financial condition and results of operations.
  • Changes in our accounting policies or in accounting standards could materially affect how we report our financial results and condition.
  • Noncompliance with the Bank Secrecy Act and other anti-money laundering statutes and regulations could cause us material financial loss.
  • We are subject to numerous laws designed to protect consumers, including the Community Reinvestment Act and fair lending laws, and failure to comply with these laws could lead to a wide variety of sanctions.
  • We may become subject to enforcement actions even though noncompliance was inadvertent or unintentional.
  • Pending litigation and legal proceedings and the impact of any finding of liability or damages could adversely impact the Company and its financial condition and results of operations.
  • We are subject to liquidity risk, which could negatively affect our funding levels.
  • Loss of deposits or a change in deposit mix could increase our cost of funding.
  • Wholesale funding sources may prove insufficient to replace deposits at maturity and support our operations and future growth.
  • The Parent Company is a holding company dependent on liquidity through payments, including dividends, from its bank subsidiary, which is subject to restrictions.
  • The soundness of other financial institutions could adversely affect the Company.
  • If the Company wants, or is compelled, to raise additional capital in the future, that capital may not be available when it is needed or on terms favorable to current shareholders.
  • The market price of our common stock is subject to volatility.
  • A reduction in our credit rating could adversely affect our access to capital and could increase our cost of funds.
  • The COVID-19 pandemic may continue to adversely affect our employees, clients, business and results of operations.
  • The Company may not be able to attract and retain skilled people.
  • Negative public opinion could damage our reputation and adversely affect our earnings.
  • Acts of terrorism, natural disasters, global climate change, pandemics and global conflicts may have a negative impact on our business and operations.
  • Anti-takeover provisions could negatively impact our shareholders.
Management Discussion
  • In 2021, net interest income increased by $3.4 million, or 4%, compared with 2020. Net interest income for 2021 on a taxable-equivalent basis increased by $3.4 million, or 4%, compared with 2020. The Company’s net interest spread decreased by twelve basis points to 3.17% for 2021 compared with 2020.
  • The taxable-equivalent yield on interest-earning assets and cost of interest-bearing liabilities both decreased from 2020 to 2021, reflecting a decreasing interest rate environment. Average commercial loans increased in 2021 due to SBA PPP loans and commercial loan production. Average balances in taxable investment securities declined as a result of sales and paydowns. Average interest-bearing liabilities declined due to decreased average balances in time deposits and overnight borrowings.
  • Taxable-equivalent interest income on loans decreased by $3.4 million, or 4%, from 2020 to 2021. The decline resulted from a decrease of 31 basis points in loan yield from 4.56% in 2020 to 4.25% in 2021 due to a decreasing interest rate environment. The impact of the reduced yield was partially offset by the increase in average loans of $56.9 million, or 3%, which was driven by SBA PPP and commercial loan production. Accretion of purchase accounting adjustments included in interest income was $2.3 million, $2.3 million, and $3.8 million in 2021, 2020 and 2019, respectively.

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