First Community Bankshares (FCBC) Net Interest Margin Resilience Challenges Bearish Narratives

First Community Bankshares (FCBC) closed out FY 2025 with Q4 revenue of US$43.8 million and basic EPS of US$0.68, compared with Q4 FY 2024 revenue of US$40.6 million and EPS of US$0.71. Full year trailing revenue came in at US$167.4 million and EPS at US$2.66. Over the past few quarters, the company has reported revenue of US$40.2 million and EPS of US$0.64 in Q1 2025, US$42.2 million and US$0.67 in Q3 2025, and the latest Q4 figures. For investors, the mix of stable revenue, EPS performance and a 4.42% trailing net interest margin supports a margin-focused read of the results.

See our full analysis for First Community Bankshares.

With the headline numbers on the table, the next step is to see how this earnings release aligns with the prevailing narratives around First Community Bankshares, and where the data may be pointing to a different angle.

Curious how numbers become stories that shape markets? Explore Community Narratives

29.1% Net Margin Pairs With 4.42% Net Interest Margin

• Over the last twelve months, First Community Bankshares reported a 29.1% net margin alongside a 4.42% net interest margin, compared with a 31.8% net margin a year earlier.
• What stands out for a bullish view is that commentary describing past earnings quality as high sits next to this 29.1% net margin and US$48.8 million of trailing net income, even though the most recent year is characterised as a loss at the earnings line, which pulls against the idea of a clean upward trend.
  • Supporters can point to consistent quarterly net income in FY 2025, such as US$12.5 million in Q4 and US$12.3 million in Q3, as evidence that the underlying business keeps generating profit.
  • On the other hand, the year on year margin move from 31.8% to 29.1% indicates some compression in profitability, which a bullish stance has to factor in alongside the positive comments on earnings quality.

Loan And Credit Quality Trends In Millions

• Total loans in the quarterly data range from US$2,444.1 million in Q3 2024 to US$2,331.3 million in Q3 2025, while non performing loans move from US$20.1 million in Q1 2025 to US$14.2 million on a trailing basis at Q4 2025.
• Bears often focus on credit risk, yet the provided figures give a different mix, because non performing loans trend from US$20.1 million in Q1 2025 to US$18.7 million in Q2, US$16.6 million in Q3 and US$14.2 million on a trailing view at Q4, which softens a cautious narrative that asset quality is deteriorating.
  • Critics can still highlight that total loans sit around the low US$2.3b level in 2025 versus US$2,444.1 million in Q3 2024, so there is not a clear loan expansion story in these snapshots.
  • Supporters, though, can point out that a lower non performing loan figure against a relatively similar loan base suggests credit issues are contained in these reported periods, which challenges a strongly bearish framing.

DCF Fair Value Versus 12.6x P/E

• The shares trade at US$33.58 with a P/E of 12.6x, while a DCF fair value of about US$48.02 implies the price is roughly 30.1% below that model, even though the P/E is slightly above the US Banks industry average of 11.8x and peer average of 12.1x.
• What the bearish angle often leans on is that paying a 12.6x P/E for a bank with a 29.1% net margin and a year that is framed as having negative earnings may look full compared with peers, yet the same data set also shows trailing net income of US$48.8 million and a 3.69% dividend yield, which gives investors tangible cash flow and income at a price that sits well under the DCF fair value estimate.
  • Skeptical investors can reasonably say the richer P/E versus peers demands proof that the forecast revenue growth of 5.5% a year and earnings growth of about 7.7% a year will actually flow through.
  • Others will focus on the combination of discount to DCF fair value, dividend yield and historically positive five year earnings growth of 2.9% a year as reasons the present valuation is not obviously stretched on every metric.

To see how this valuation gap and P/E premium fit into longer term narratives around growth, risk and income, you can step through the full balanced story for FCBC in one place. 📊 Read the full First Community Bankshares Consensus Narrative.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on First Community Bankshares's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

First Community Bankshares combines a 29.1% net margin and 4.42% net interest margin with some margin compression, limited loan growth and a share price above the industry average P/E.

If that mix feels a bit tight for your comfort, use our stable growth stocks screener (2166 results) to focus on companies with clearer patterns of steady revenue and earnings instead of mixed signals.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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