STBA
STBA
Trim 2026-04-02
Model
DDM
Price at Report
$42.28
Base IV
$30.58
Bear IV
$23.08
Bull IV
$37.77
Entry Zone: 24-28 · Sell Above: 32
Bore Family Office
Valuation Report — S&T Bancorp, Inc. (STBA) • April 2, 2026
3-Stage DDM (Ke) • Discount Rate: 9.15% • Current Price: $42.28
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
S&T Bancorp, Inc. (NASDAQ: STBA) is a Pennsylvania-based bank holding company headquartered in Indiana, Pennsylvania (not to be confused with the state of Indiana). Founded in 1902, S&T operates primarily in western Pennsylvania, eastern Ohio, and central New York through its S&T Bank subsidiary. With $9.9B in total assets, S&T provides commercial and retail banking services to small and medium-sized businesses and consumers. The bank has grown through acquisitions (including DNB Financial in 2020) and organic loan growth. S&T has a 13-year dividend growth streak with a 3.4% yield — among the higher yields in the community bank space. ROE of 9.25% is near industry average, reflecting the competitive Pennsylvania market.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| Commercial Banking | $275M | 70% | +4.0% | — | C&I, CRE, small business lending |
| Consumer Banking | $120M | 30% | +2.0% | — | Mortgages, consumer deposits, retail |
| Blended Growth Rate | — | 100% | +3.4% | — | Weighted avg across segments |
🔍 Quality Scorecard
| Metric | Value | Assessment |
|---|---|---|
| ROIC | 9.2% | 8–12% adequate |
| Revenue Trend | Growing 3yr | 3-year directional trend |
| FCF Margin Trend | Stable (±1pp) | Directional margin trajectory |
| Analyst Revisions | Neutral | Last 90 days consensus direction |
✅ Quality profile supports the valuation
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $325 | $364 | $387 | $384 | $395 |
| Rev YoY Growth | — | +12.0% | +6.3% | -0.8% | +2.9% |
| Gross Margin | — | — | — | — | — |
| EBITDA ($M) | $0 | $0 | $0 | $0 | $0 |
| EBITDA Margin | — | — | — | — | — |
| Operating Income ($M) | $0 | $0 | $0 | $0 | $0 |
| Operating Margin | — | — | — | — | — |
| Net Income ($M) | $110 | $136 | $145 | $131 | $134 |
| Net Margin | 33.8% | 37.4% | 37.5% | 34.1% | 33.9% |
| EPS (diluted) | $2.81 | $3.47 | $3.74 | $3.41 | $3.49 |
| Free Cash Flow ($M) | $0 | $0 | $0 | $0 | $0 |
| Annual DPS | $1.140 | $1.230 | $1.300 | $1.340 | $1.400 |
| Total Debt ($M) | $0 | $0 | $0 | $0 | $0 |
📈 DDM Scenarios
$23
🔴 Bear
$31
📊 Base
$38
🚀 Bull
$42.28
Current Price
$43
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | Ke | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | 4.0% | 3.0% | 2.0% | 9.15% | $23 | ▼45.4% |
| 📊 Base | 7.0% | 5.0% | 3.0% | 9.15% | $31 | ▼27.7% |
| 🚀 Bull | 9.5% | 6.5% | 3.5% | 9.15% | $38 | ▼10.7% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: 4.0% | Stage 2: 3.0% | Terminal: 2.0%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $1.498 | $1.372 | $1.37 |
| Year 2 | Stage 1 | $1.558 | $1.307 | $2.68 |
| Year 3 | Stage 1 | $1.620 | $1.246 | $3.93 |
| Year 4 | Stage 1 | $1.685 | $1.187 | $5.11 |
| Year 5 | Stage 1 | $1.752 | $1.131 | $6.24 |
| Year 6 | Stage 2 | $1.805 | $1.067 | $7.31 |
| Year 7 | Stage 2 | $1.859 | $1.007 | $8.32 |
| Year 8 | Stage 2 | $1.914 | $0.950 | $9.27 |
| Year 9 | Stage 2 | $1.972 | $0.897 | $10.16 |
| Year 10 | Stage 2 | $2.031 | $0.846 | $11.01 |
| Terminal | — | TV=$28.97 | PV(TV)=$12.07 (52% of IV) | $23.08 |
| Intrinsic Value | — | — | PV(Divs) $11.01 + PV(TV) $12.07 | $23.08 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (9.15%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (2.0%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $28.97. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $12.07). Intrinsic value = PV of all dividends ($11.01) + PV of terminal value ($12.07) = $23.08 per share.
Base Scenario
Stage 1: 7.0% | Stage 2: 5.0% | Terminal: 3.0%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $1.541 | $1.412 | $1.41 |
| Year 2 | Stage 1 | $1.649 | $1.384 | $2.80 |
| Year 3 | Stage 1 | $1.764 | $1.357 | $4.15 |
| Year 4 | Stage 1 | $1.888 | $1.330 | $5.48 |
| Year 5 | Stage 1 | $2.020 | $1.304 | $6.79 |
| Year 6 | Stage 2 | $2.121 | $1.254 | $8.04 |
| Year 7 | Stage 2 | $2.227 | $1.206 | $9.25 |
| Year 8 | Stage 2 | $2.338 | $1.161 | $10.41 |
| Year 9 | Stage 2 | $2.455 | $1.116 | $11.52 |
| Year 10 | Stage 2 | $2.578 | $1.074 | $12.60 |
| Terminal | — | TV=$43.17 | PV(TV)=$17.99 (59% of IV) | $30.58 |
| Intrinsic Value | — | — | PV(Divs) $12.60 + PV(TV) $17.99 | $30.58 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (9.15%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (3.0%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $43.17. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $17.99). Intrinsic value = PV of all dividends ($12.60) + PV of terminal value ($17.99) = $30.58 per share.
Bull Scenario
Stage 1: 9.5% | Stage 2: 6.5% | Terminal: 3.5%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $1.577 | $1.445 | $1.44 |
| Year 2 | Stage 1 | $1.727 | $1.449 | $2.89 |
| Year 3 | Stage 1 | $1.891 | $1.454 | $4.35 |
| Year 4 | Stage 1 | $2.070 | $1.459 | $5.81 |
| Year 5 | Stage 1 | $2.267 | $1.463 | $7.27 |
| Year 6 | Stage 2 | $2.414 | $1.428 | $8.70 |
| Year 7 | Stage 2 | $2.571 | $1.393 | $10.09 |
| Year 8 | Stage 2 | $2.738 | $1.359 | $11.45 |
| Year 9 | Stage 2 | $2.916 | $1.326 | $12.78 |
| Year 10 | Stage 2 | $3.106 | $1.294 | $14.07 |
| Terminal | — | TV=$56.89 | PV(TV)=$23.70 (63% of IV) | $37.77 |
| Intrinsic Value | — | — | PV(Divs) $14.07 + PV(TV) $23.70 | $37.77 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (9.15%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (3.5%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $56.89. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $23.70). Intrinsic value = PV of all dividends ($14.07) + PV of terminal value ($23.70) = $37.77 per share.
🔲 Sensitivity Table
| Ke \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 7.1% | $37 | $40 | $43 | $47 | $51 |
| 7.6% | $34 | $36 | $38 | $41 | $45 |
| 8.2% | $31 | $32 | $34 | $36 | $39 |
| 8.6% | $29 | $30 | $32 | $34 | $36 |
| 9.1% | $27 | $28 | $29 | $31 | $33 |
| 9.7% | $25 | $26 | $27 | $28 | $29 |
| 10.1% | $24 | $24 | $25 | $26 | $27 |
| 10.6% | $22 | $23 | $24 | $25 | $25 |
| 11.2% | $21 | $21 | $22 | $23 | $23 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🏦 Comparable Valuation
| Company | P/E | P/B | Div Yield | ROE | Note |
|---|---|---|---|---|---|
| STBA (current) | 12.1x | 1.11x | 3.4% | 9.3% | 13-yr div growth; PA regional |
| 1st Source (SRCE) | 10.9x | 1.35x | 2.3% | 13.0% | IN/MI; superior ROE; 39-yr streak |
| Univest Financial | 10.2x | 1.05x | 3.5% | 10.0% | PA peer; similar profile |
| Mid Penn Bancorp | 9.8x | 0.90x | 2.4% | 9.0% | Central PA; smaller scale |
| WSFS Financial | 11.5x | 1.20x | 1.8% | 11.0% | Delaware Valley; larger scale |
💰 Dividend / Distribution Analysis
| Metric | Value |
|---|---|
| Annual DPS | $1.440 |
| Current Yield | 3.41% |
| Consecutive Growth Years | 13 |
| 1-yr DPS CAGR | +4.5% |
| 3-yr DPS CAGR | +4.8% |
| 5-yr DPS CAGR | +5.2% |
| 10-yr DPS CAGR | +4.5% |
| Payout Ratio (DPS/EPS) | 40.1% |
| FCF Payout Ratio | 40.0% |
| Sustainability Verdict | Safe |
Payout ratio of 40% is conservative for a community bank. STBA retains 60% of earnings for capital growth. ROE of 9.25% is adequate to support 4–5% dividend growth indefinitely. 13-year dividend growth streak demonstrates management commitment. No sustainability concerns.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $2.81 | — | — | — | Actual |
| 2022 | $3.47 | — | — | — | Actual |
| 2023 | $3.74 | — | — | — | Actual |
| 2024 | $3.41 | — | — | — | Actual |
| 2025 | $3.49 | — | — | — | Actual |
| 2026 | $3.49 | $3.69 | $3.87 | 9 | Estimate |
| 2027 | $3.67 | $3.85 | $4.03 | 9 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $0.3B | — | — | — | Actual |
| 2022 | $0.4B | — | — | — | Actual |
| 2023 | $0.4B | — | — | — | Actual |
| 2024 | $0.4B | — | — | — | Actual |
| 2025 | $0.4B | — | — | — | Actual |
| 2026 | $0.4B | $0.4B | $0.5B | 9 | Estimate |
| 2027 | $0.4B | $0.5B | $0.5B | 9 | Estimate |
(c) Individual Analyst Price Targets
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Jake Civiello | DA Davidson | Hold | $47 | +11.2% |
| Daniel Cardenas | Janney Montgomery Scott | Strong Buy | $46 | +8.8% |
| Michael Perito | KBW | Hold | $42 | -0.7% |
| Justin Crowley | Piper Sandler | Hold | $40 | -5.4% |
💡 Investment Thesis
P/B Justified Multiple Analysis:
P/B = (ROE - g) / (Ke - g) where ROE=9.25%, Ke=9.15%, g=2.5% terminal
Justified P/B = (0.0925 - 0.025) / (0.0915 - 0.025) = 0.0675 / 0.0665 = 1.02x
Current P/B = $42.28 / $38.03 = 1.11x
→ STBA trades at a 9% premium to justified P/B. At current ROE, stock is fairly valued to slightly expensive.
If ROE improves to 11% (bull case): Justified P/B = (0.11 - 0.025) / (0.0915 - 0.025) = 1.28x → fair value ~$48.
Bull case: Pennsylvania economy strengthens; NIM expands from loan growth. ROE improves to 11% justifying P/B re-rating to 1.3x. Dividend grows 6–7%/yr. Target: $47–$50.
Bear case: CRE concentration (~30% of loans) creates credit risk if office/retail stress spreads. ROE could compress to 8%, justifying only 0.83x P/B → fair value $32. Higher beta (0.89) means more volatility than SRCE in downturns.
Base case: ROE stays ~9%, book value grows 5%/yr, P/B holds at 1.1x. Fair value ~$42–$44. Dividend yield of 3.4% + 4% dividend growth = 7–8% total return.
👔 Management Quality & Culture
CEO: Transition Mc · Tenure: Since 2021 (~5 yrs)
Net Insider Buys (12m)
+19,695 shares
Incentive Alignment
⚠️ Moderate
Compensation: Equity-based compensation present
CEO Background & Track Record
S&T Bancorp Inc - Company Profile and News - Bloomberg Marke
Company profile page for S&T Bancorp Inc including stock price, company news, executives, board members, and contact information
Company profile page for S&T Bancorp Inc including stock price, company news, executives, board members, and contact information
Governance - Board of Directors - S&T Bancorp, Inc.
By providing your email address below, you are providing consent to S&T Bancorp, Inc.
By providing your email address below, you are providing consent to S&T Bancorp, Inc.
S&T Bancorp, Inc. Announces Board of Directors Leadership Tr
(S&T) (NASDAQ: STBA), the holding company for S&T Bank, today announced that Christine J. Toretti, chair of the board of directors of both S&T Bancorp, Inc. and S&T Bank since 2018, and a director since 1984
(S&T) (NASDAQ: STBA), the holding company for S&T Bank, today announced that Christine J. Toretti, chair of the board of directors of both S&T Bancorp, Inc. and S&T Bank since 2018, and a director since 1984
Capital Allocation & Strategy
S&T Bancorp 2026 Company Profile: Stock Performance & Earnin
You’re viewing 5 of 6 acquisitions. Get the full list » ... Peer performance insights compare the company’s ESG performance to the performance of selected peers to help inform future ESG decisions and drive internal performance improvements
You’re viewing 5 of 6 acquisitions. Get the full list » ... Peer performance insights compare the company’s ESG performance to the performance of selected peers to help inform future ESG decisions and drive internal performance improvements
S&T Bancorp details 2025 size and capital strength | STBA SE
S&T Bancorp’s 2025 annual report shows $9.9B in assets, $8.1B in loans and strong capital ratios well above well‑capitalized levels, alongside detailed regulatory, risk and human capital disclosures.
S&T Bancorp’s 2025 annual report shows $9.9B in assets, $8.1B in loans and strong capital ratios well above well‑capitalized levels, alongside detailed regulatory, risk and human capital disclosures.
Employee Ratings
Overall Rating
3.8/5 ★★★★☆
Reviews
43
Culture Signal
Positive
✅ Strengths
- recommend
Employee Review Excerpts
43 Reviews: What Is It Like to Work At S&T Bancorp? | Glassd
Employees also rated S&T Bancorp 3.8 out of 5 for work life balance, 4.1 for culture and values and 4.0 for career opportunities. What are the pros and cons of working at S&T Bancorp?
Employees also rated S&T Bancorp 3.8 out of 5 for work life balance, 4.1 for culture and values and 4.0 for career opportunities. What are the pros and cons of working at S&T Bancorp?
SS&C Business Analyst Reviews | Glassdoor
not recognized for the extra work you take on after they release staff so they can increase their own wealth. CEO's you can't spend it when your dead.
not recognized for the extra work you take on after they release staff so they can increase their own wealth. CEO's you can't spend it when your dead.
Working at SS&C: 1,314 Reviews | Indeed.com
Not a bad place to build a career, ighly performance driven culture in sales/business development roles On-boarding: below average Culture: average Pay/comp: average Benefits: average Management vision: average
Not a bad place to build a career, ighly performance driven culture in sales/business development roles On-boarding: below average Culture: average Pay/comp: average Benefits: average Management vision: average
Sources: Finnhub insider data · Brave Search (Glassdoor, Indeed, Comparably, news) · Earnings surprise data from analyst forecasts · Qualitative signals are directional only.
⚖️ DDM Verdict: Trim — S&T Bancorp, Inc. (STBA)
Current price: $42.28 | Analyst Avg PT: $43.00
$23
🔴 Bear
$31
📊 Base
$38
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$28 | Begin position |
| Tier 2 — Add | ≤$27 | Add on weakness |
| Tier 3 — Full | ≤$24 | Full allocation |
| Sell Alert | ≥$32 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
Hold at current levels. At $42.28, STBA is fairly valued — P/B of 1.11x aligns with 9.25% ROE. The 3.4% dividend yield is attractive but growth is modest. Accumulate below $38; full position at $35. STBA is a yield play, not a growth play. Thesis breaks if CRE credit losses spike or ROE falls below 8%. At $48+, reduce to underweight.
🔧 Model Notes & Calibration
| Assumption | Rationale / Notes |
|---|---|
| Model Choice | P/B Justified Multiple primary; DDM cross-check. Both methods converge on ~$40–$45 fair value. |
| ROE Input | ROE 9.25% (Finnhub TTM). This is near cost of equity (9.15%), meaning STBA earns near its required return — P/B ~1.0x is justified. |
| Ke for DDM | Ke = 4.25% (Rf) + 0.89 (beta) × 5.5% (ERP) = 9.15%. Higher beta than SRCE reflects more cyclicality. |
| Justified P/B | At ROE=9.25%, Ke=9.15%, g=2.5%: Justified P/B = 1.02x. Current P/B = 1.11x. Slight premium to fair value. |
| DDM Cross-Check | DDM with DPS $1.44, g1=5%, gT=2.5%, Ke=9.15% yields IV ~$38–$42. Consistent with current price. |
| CRE Risk | CRE represents ~30% of loan book. Pennsylvania office/retail markets are stable but warrant monitoring. Not a red flag but a watchlist item. |
Bore Family Office • Analysis generated by Lurch • Not investment advice.