Avidia Bancorp (AVBC) Cost Efficiency Gains Challenge Bearish Earnings Narratives

Avidia Bancorp (AVBC) has wrapped up FY 2025 with fourth quarter revenue of US$26.1 million, net income of US$5.3 million and basic EPS of US$0.29, set against trailing twelve month revenue of US$82.1 million and a TTM net loss of US$3.3 million or EPS of US$0.18. The company has seen revenue move from US$88.5 million in FY 2024 to US$82.1 million on a trailing basis, while earnings have shifted from a profit of US$11.5 million over FY 2024 to a TTM loss of US$3.3 million. This leaves investors weighing FY 2025’s quarterly profitability against the pressure on margins implied by the full year picture.

See our full analysis for Avidia Bancorp.

With the latest results on the table, the next step is to set these numbers against the widely followed narratives around Avidia Bancorp to see which views line up with the data and which ones the earnings now call into question.

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Cost Efficiency Improves With 67.19% Ratio

• Avidia’s cost to income ratio for FY 2025 Q4 sits at 67.19%, compared with 81.56% in FY 2024 Q4, alongside a net interest margin of 3.43% versus 3% a year earlier.
• What stands out for the bullish view that earnings can grow quickly is that profitability in Q4, with US$5.3 million of net income, comes alongside lower operating intensity,
  • the combination of a 67.19% cost to income ratio and a 3.43% net interest margin differs from the trailing 12 month loss of US$3.3 million, so bulls may focus on the latest quarter rather than the full year picture,
  • while forecasts point to earnings growth of about 81.09% a year and a return to profitability within three years, the recent quarterly cost and margin profile gives that optimism some recent operational backing.

To see how this cost and margin shift fits into a longer term story for Avidia Bancorp, it helps to read the full narrative that ties recent results to projected growth and profitability. 📊 Read the full Avidia Bancorp Consensus Narrative.

Non Performing Loans Rise To US$20.2 Million

• Non performing loans have moved from US$4.0 million in FY 2024 Q4 to US$20.2 million in FY 2025 Q4, alongside total loans of US$2,295.5 million at the latest quarter.
• Skeptical investors who focus on the risk of worsening credit quality may point to this step up in non performing loans as a counterweight to the upbeat profit forecasts,
  • because the trailing 12 month view already shows a net loss of US$3.3 million and widening losses over five years, any increase in problem loans can make it harder for the business to rely purely on margin improvement,
  • and with non performing loans at US$20.2 million against total loans of about US$2.3b, credit trends are likely to be a key line item for anyone testing how durable future earnings could be.

TTM Loss Of US$3.3 Million Versus 81.09% Earnings Growth Forecast

• On a trailing 12 month basis to FY 2025 Q4, Avidia reports US$82.1 million in revenue and a net loss of US$3.3 million or basic EPS of US$0.18 loss, while the shares trade at US$19.49 with a P/B of 1.0 compared with 1.1 for the US Banks industry and 1.2 for peers.
• What is striking for the bullish camp is the contrast between the current loss and the forecast for 81.09% yearly earnings growth and a return to profitability within three years,
  • because the bank is still unprofitable over the last year and has seen losses grow at 47.7% a year over five years, supporters of the bullish case may lean heavily on the improving recent quarter and the relatively lower P/B multiple,
  • while critics can point out that, with TTM revenue already at US$82.1 million and the business still loss making, the jump from loss to profit implied by those growth forecasts is meaningful and depends on more than just one strong Q4.

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 Avidia Bancorp'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

Avidia’s recent quarter is profitable, but the TTM loss of US$3.3 million and higher non performing loans raise questions about balance sheet resilience and earnings quality.

If that mix makes you cautious, you may wish to focus on companies screened for stronger financial footing and liquidity by checking out solid balance sheet and fundamentals stocks screener (388 results) today.

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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