Breaking Down Landmark Bancorp, Inc. (LARK) Financial Health: Key Insights for Investors

You're looking at Landmark Bancorp, Inc. (LARK) and wondering if the recent earnings surge is a genuine inflection point or just a blip in a tough banking environment, and honestly, the third-quarter 2025 numbers defintely demand a closer look. The direct takeaway is that LARK delivered a strong quarter, reporting net earnings of $4.9 million, which marks a substantial 25.4% jump from the same quarter last year, pushing year-to-date net earnings to a solid $14.0 million, a 44.4% increase. That's real performance, not just accounting magic. With total assets sitting at $1.62 billion and a healthy Return on Average Assets (ROAA) of 1.21%, the bank is clearly managing its balance sheet well, plus the book value per share is up to $26.92. Still, the market is cautious; despite diluted earnings per share (EPS) hitting $0.85, the stock is trading below its estimated fair value of $28.10, and some analysts have moved to a Hold rating, so we need to map that near-term risk against the operational wins, like the $7.0 million drop in non-performing loans.

Revenue Analysis

You need to know where the money is coming from to gauge the quality of Landmark Bancorp, Inc.'s (LARK) earnings. The direct takeaway is that Landmark Bancorp, Inc.'s revenue engine is firing on its core business-lending-with Net Interest Income (NII) driving nearly 79% of the top line, while Non-interest Income is showing mixed, but improving, trends.

For the first nine months of 2025, the company generated a total revenue of approximately $52.0 million (Net Interest Income plus Non-interest Income). This growth is defintely a good sign in a competitive market. The primary revenue driver, Net Interest Income (NII)-the difference between interest earned on assets like loans and interest paid on liabilities like deposits-surged to $40.9 million for the nine months ended September 30, 2025. That's a massive jump, up 22.7% from the same period in 2024.

Here's the quick math on how the segments contribute to the overall revenue for the first nine months of 2025:

The NII Growth Engine: Loans and Deposits

The core of Landmark Bancorp, Inc.'s revenue strength is its loan portfolio. NII is expanding because average loan balances are growing-they were up by $26.7 million in the third quarter of 2025 alone-and the bank is managing its funding costs well. This focus on commercial and agricultural lending, which are core to the bank's Kansas market, is paying off. The company also benefited from lower interest expenses on interest-bearing deposits in Q3 2025, which fell from 2.48% to 2.18% year-over-year, helping to widen the net interest margin (NIM).

• Growth is driven by commercial and agricultural loan portfolios.
• Q3 2025 NII increased 21.5% to $14.1 million year-over-year.
• Lower deposit costs helped boost the net interest margin.

Non-Interest Income: A Mixed Bag with Upside

Non-interest income, which is crucial for revenue diversification, has been a bit of a mixed bag. For the first nine months of 2025, it totaled $11.1 million, representing a modest year-over-year decrease of 2.8%. This decline was primarily due to lower fees and service charges compared to the previous year. Still, the quarter-over-quarter trend is positive, which is important.

In the third quarter of 2025, Non-interest Income was $4.1 million, which was actually down 4.3% from the same quarter last year. But, it increased sequentially by $442,000 from the second quarter. This quarter-to-quarter lift was largely due to stronger mortgage activity, specifically a $208,000 increase in gains on sales of residential mortgage loans, plus a $184,000 rise in deposit-related fees. That tells you the mortgage business is picking up steam, which is a good sign for future revenue diversification. For a deeper look at the risks, check out Breaking Down Landmark Bancorp, Inc. (LARK) Financial Health: Key Insights for Investors.

Profitability Metrics

You're looking for a clear signal on whether Landmark Bancorp, Inc. (LARK) is a bank that can sustain its recent earnings momentum, and the latest Q3 2025 data gives us a strong, albeit complex, answer. The short takeaway is that LARK's core profitability metrics are currently outperforming the industry average, driven by robust net interest income and sharp cost control, but you must keep the long-term trend in mind.

For a bank, the traditional gross profit margin is less useful than the Net Interest Margin (NIM), which measures the core lending spread. For the trailing twelve months (TTM) ended Q3 2025, Landmark Bancorp, Inc. reported total revenue (which acts as the proxy for gross revenue in banking) of $64.37 million. This revenue, primarily driven by interest income, translated into impressive bottom-line figures, signaling excellent cost discipline.

• Gross Profit Margin: The bank's core profitability is best reflected in its Net Interest Margin (NIM), which stood at a healthy 3.83% in Q3 2025, holding steady from the prior quarter. This places LARK comfortably within the typical 3.5% to 4.5% range for US community banks.
• Operating Profit Margin: TTM Operating Income was $21.59 million, giving us an operating margin of approximately 33.5%. This is a solid indicator of the bank's ability to manage non-interest expenses relative to its revenue base.
• Net Profit Margin: The net profit margin for Q3 2025 improved significantly to 26.1%, a substantial jump from 20.2% a year earlier. Net earnings for the quarter totaled $4.9 million.

Here's the quick math on profitability ratios against the sector, which shows LARK is punching above its weight. You can see LARK's Return on Average Assets (ROAA) and Return on Average Equity (ROAE) are currently superior to the aggregate industry figures from earlier in 2025.

Operational Efficiency and Trends

The recent surge in profitability is defintely tied to operational efficiency. The bank's efficiency ratio-which measures non-interest expense as a percentage of total revenue-improved to 60.7% in Q3 2025. This is a strong positive, as it's better than the 62.8% reported in the prior quarter and below the projected Q3 2025 average of around 61.2% for major US banks. Lowering this ratio means LARK is generating more revenue per dollar of operating expense.

The trend is clear: LARK's net earnings for the first nine months of 2025 totaled $14.0 million, an increase of 44.4% compared to the same period in 2024. This near-term growth is significant and is primarily driven by higher net interest income and successful cost management, including savings realized from 2024 branch closures. Still, a trend-aware realist must acknowledge the backdrop: the company's five-year average shows an annual earnings decline of 11.1%. The recent margin rebound is a strong counter-narrative, but the sustainability of the growth needs to be watched closely.

Your action item is to monitor the efficiency ratio and NIM in the next quarter. If the NIM holds above 3.80% and the efficiency ratio stays below 61.0%, it suggests the cost-cutting and loan pricing strategies are working, not just a one-off earnings spike. For a deeper look at the market's reaction to these numbers, you should read Exploring Landmark Bancorp, Inc. (LARK) Investor Profile: Who's Buying and Why?

Debt vs. Equity Structure

You're looking at Landmark Bancorp, Inc. (LARK)'s balance sheet to figure out how they fund their growth, and the numbers from the third quarter of 2025 show a clear shift toward capital strength. The direct takeaway is that Landmark Bancorp, Inc. (LARK) has a moderate and improving debt profile, sitting well below the general risk threshold for financial leverage.

As of the most recent quarter, your main focus is the debt-to-equity (D/E) ratio, which tells you how much debt a company uses to finance its assets relative to the value of its shareholders' equity. For Landmark Bancorp, Inc. (LARK), we see a D/E ratio of approximately 0.73 as of September 30, 2025. Here's the quick math: total debt of $113.55 million divided by stockholders' equity of $155.7 million gives you that figure.

This ratio of 0.73 is a strong signal. It means that for every dollar of shareholder equity, the company uses about 73 cents of debt. To put that in perspective, the average D/E ratio for US regional banks in 2025 is around 0.5, so Landmark Bancorp, Inc. (LARK) is slightly higher, but it's still far below the general investor caution line of 1.5. A D/E of 1.5 or lower is defintely desirable for most companies.

Borrowing Reduction and Capital Strength

The real story here isn't just the ratio, but the direction of travel. Landmark Bancorp, Inc. (LARK) actively deleveraged in the third quarter of 2025. Total period-end borrowings decreased by a significant $69.0 million during that period. This was a deliberate move to reduce reliance on higher-cost funding sources, specifically the Federal Home Loan Bank (FHLB) and other market borrowings.

This reduction shows a conservative and proactive approach to liquidity management, especially as the bank continues to build its capital base. Stockholders' equity increased to $155.7 million at the end of Q3 2025, up from $148.4 million in the prior quarter, driven by net earnings and lower unrealized losses on investment securities. The company is generating capital internally.

• Total Debt (MRQ): $113.55 million
• Total Equity (Q3 2025): $155.7 million
• Q3 2025 Borrowing Decrease: $69.0 million

The company balances debt financing with equity funding through a consistent return to shareholders. In October 2025, the Board declared a 5% stock dividend, marking the 25th consecutive year of such a dividend. This long-standing practice is a clear sign that management is comfortable returning capital to shareholders while maintaining a strong regulatory capital position. You can read more about their philosophy in the Mission Statement, Vision, & Core Values of Landmark Bancorp, Inc. (LARK).

What this estimate hides is the composition of the remaining debt-is it short-term or long-term? But the overall trend is toward a cleaner balance sheet, which is a key opportunity for investors. Lower debt means less interest expense, which directly boosts net income. The move to reduce borrowings, plus the solid equity base, gives them flexibility to pursue strategic loan growth or acquisitions without stressing the balance sheet.

Liquidity and Solvency

You want to know if Landmark Bancorp, Inc. (LARK) has the cash to cover its short-term obligations, and the quick answer is yes, they do. Their liquidity position as of late 2025 is solid, driven by a strategic reduction in costly borrowings and a healthy inflow of deposits. We're seeing a deliberate move to self-fund growth, which is defintely a positive sign for investors.

For a financial institution like Landmark Bancorp, Inc., traditional liquidity ratios tell a slightly different story than for a manufacturing company. Still, the numbers are strong. The company's Current Ratio, which compares current assets to current liabilities, stood at a healthy 1.86 as of October 2025. That's nearly two dollars of short-term assets for every dollar of short-term debt. The Quick Ratio, which strips out less-liquid assets like inventory, is less relevant here since a bank's primary assets are loans and securities, not inventory, so we focus on the broader picture.

Here's the quick math on their funding structure, which is the real working capital analysis for a bank:

• Deposits Surge: Total deposits increased by $51.6 million in the third quarter of 2025 alone.
• Borrowing Reduction: Total borrowings decreased by a significant $69.0 million during the same quarter.
• Loan-to-Deposit Improvement: The crucial loan-to-deposit ratio eased to 83.4% from 86.6% in the prior quarter.

This trend shows Landmark Bancorp, Inc. is successfully replacing wholesale funding (borrowings) with core deposits, which are generally a more stable and less expensive source of funds. That's a powerful trend toward lower funding costs and better liquidity management. You can see how this strategy aligns with their core principles by reviewing their Mission Statement, Vision, & Core Values of Landmark Bancorp, Inc. (LARK).

Cash Flow Statements Overview

Looking at the Trailing Twelve Months (TTM) cash flow statement ending in Q3 2025, we get a clear view of where the money is moving. Operating cash flow is robust, but the investing side shows significant deployment of capital, which is typical for a growing bank.

Liquidity Strengths and Concerns

The overall liquidity picture is strong, but a realist always maps the risks. The company's capital base is solid, with total assets at $1.6 billion as of September 30, 2025, and a high proportion of deposits being retail-based and FDIC insured. This stability is a massive strength.

However, there are still watch items. Management has noted an uptick in early delinquencies quarter-over-quarter, and the company still has some dependence on brokered deposits to fuel its deposit growth. Brokered deposits can be a less sticky, more rate-sensitive funding source than core retail deposits. The key action here is to monitor the asset quality metrics-specifically, the trend in non-performing loans (NPLs) and the allowance for credit losses-to ensure the strong cash flow isn't masking future credit issues. For now, the improved loan-to-deposit ratio shows management is proactively strengthening its balance sheet.

Valuation Analysis

You are looking at Landmark Bancorp, Inc. (LARK) and trying to figure out if the stock price of around $28.27 is a bargain or a trap. The quick answer is that the market views LARK as fairly valued, leaning toward a slight undervaluation compared to its tangible assets, but analysts are cautious.

The core of the valuation story is that the bank trades at conservative multiples, which is typical for a smaller regional bank in a challenging interest rate environment. The consensus from the limited analyst coverage is a simple Hold rating, with an average price target of $28.00 as of late 2025.

Here is a snapshot of the key metrics for Landmark Bancorp, Inc. (LARK) based on the latest 2025 financial data:

• Price-to-Earnings (P/E) Ratio: At 9.09, the P/E ratio is low, suggesting the stock is inexpensive relative to its trailing-twelve-months (TTM) earnings. This is defintely a value signal compared to the broader market.
• Price-to-Book (P/B) Ratio: The P/B ratio is 1.145. [cite: 10 in previous search] A P/B just over 1.0 means the market is valuing the company's equity (its book value) at a small premium, which is a healthy sign for a bank, reflecting confidence in the quality of its assets.
• Enterprise Value-to-EBITDA (EV/EBITDA): For a bank holding company like LARK, this metric is less relevant and is often not calculated or reported by standard financial services data providers. Instead, a more telling figure is the Enterprise Value-to-Earnings ratio, which stands at 14.43.

The stock price has had a strong run over the last year, increasing by +29.06% in the 52 weeks leading up to late November 2025. [cite: 5 in previous search] Still, that growth has been volatile, with the price trading in a wide 52-week range between a low of $20.75 and a high of $31.04. That kind of swing shows market uncertainty, even with solid earnings. You can dig deeper into their operational strategy by reviewing the Mission Statement, Vision, & Core Values of Landmark Bancorp, Inc. (LARK).

As an income investor, you should pay attention to the dividend profile. Landmark Bancorp, Inc. has a strong track record, maintaining a 23-year streak of dividend growth. [cite: 12 in previous search] The forward annual payout is $0.84 per share, giving a current dividend yield of approximately 3.1%. The payout ratio is very sustainable at 28.19%, meaning less than a third of their earnings are going toward the dividend, leaving plenty of capital for growth or to absorb any unexpected losses.

Here's the quick math: with a P/E of 9.09 and a P/B of 1.145, the valuation suggests the stock is modestly undervalued based on its earnings and tangible assets. What this estimate hides, however, is the risk associated with its regional banking focus and the need for continued loan growth to justify the slight premium to book value.

The bottom line is that LARK is a stable, income-generating bank, but it's not a high-growth stock. To be fair, the Hold consensus is a pragmatic view: the stock is not cheap enough to be a screaming buy, but the solid dividend and low P/E mean it's not a clear sell either.

Next Step: Portfolio Managers should assess LARK's 3.1% yield against their fixed-income alternatives by Friday to determine if the risk-adjusted return profile still fits the income sleeve of their portfolio.

Risk Factors

You're looking at Landmark Bancorp, Inc. (LARK)'s recent performance, and while the Q3 2025 numbers-like the 13.00% return on average equity-look strong, a seasoned analyst knows to look past the headline earnings. The real job is mapping the risks that could derail that momentum. For LARK, the biggest threats are a mix of long-term structural issues and near-term credit quality concerns.

Honestly, the market is weighing the recent profit surge against a weak long-term trend. The five-year average shows an annual earnings decline of 11.1%, so the recent strength needs to be viewed cautiously. That's the core strategic challenge: sustaining growth after years of contraction. You can find a deeper dive on the financials at Breaking Down Landmark Bancorp, Inc. (LARK) Financial Health: Key Insights for Investors.

Near-Term Credit and Liquidity Pressures

The most immediate and concrete risk is asset quality, specifically in the loan portfolio. In the second quarter of 2025, non-performing loans (NPLs)-which are loans where the borrower is not making payments-jumped to $17 million, or 1.52% of gross loans, up from 1.24% in the prior quarter. This increase was tied primarily to just two commercial real estate credits. That's a concentrated risk.

Plus, the bank faced liquidity pressure from deposit outflows. In Q2 2025, total deposits dropped by $61.9 million due to seasonal and brokered outflows. This pushed the loan-to-deposit ratio up to 86.6% at June 30, 2025, compared to 79.5% in the previous quarter. You need to keep a close eye on that ratio; it's a key indicator of funding stability.

• Credit Concentration: NPLs hit $17 million in Q2 2025, driven by two commercial real estate loans.
• Funding Risk: Q2 2025 deposit outflows of $61.9 million increased the loan-to-deposit ratio.
• Long-Term Trend: Five-year average annual earnings decline of 11.1% persists.

External and Operational Headwinds

External risks are the typical bank headwinds: economic uncertainty, interest rate volatility, and fierce competition. Management is defintely right to focus on interest rate risk, as changes could quickly erode their net interest margin (NIM), which held steady at 3.83% in Q3 2025. Competition from larger banks, credit unions, and financial technology (fintech) companies is also a constant threat, especially for a community-focused institution like Landmark Bancorp, Inc. (LARK).

On the operational side, the filings highlight the increasing cost and risk associated with technology, including AI-related cyber risk. For a bank of this size, keeping up with the technology arms race and managing cyber security is a significant, non-interest expense burden.

Mitigation Strategies and Clear Actions

The good news is the company is aware of these risks and has taken clear steps. They are not just sitting still. To combat the credit risk, they increased their allowance for credit losses by $1 million in Q2 2025, bringing the total allowance to $13.8 million (or 1.23% of gross loans). This is prudent. Here's the quick math on recent credit quality improvement:

To address the funding risk, management has outlined a plan for intensified deposit gathering through its community branch network. They are also maintaining a strong capital position, with a bank leverage ratio of 9.2% and a total risk-based capital ratio of 13.6% as of June 30, 2025, both well above the regulatory well-capitalized levels. That strong capital base provides a buffer against unexpected credit losses or market shocks. Management: continue to execute the deposit gathering plan and report on core deposit growth by the end of Q4.

Growth Opportunities

You're looking for a clear map of where Landmark Bancorp, Inc. (LARK) goes from here, and the short answer is that the bank is executing a focused, profitable growth strategy anchored in its core Kansas market. They are not chasing risky, high-beta plays; they are simply getting better at what they already do well.

The numbers from the 2025 fiscal year are defintely encouraging. For the first nine months of 2025, net earnings hit $14.0 million, marking a substantial 44.4% increase over the same period last year. Here's the quick math: that growth is driven by a surge in net interest income, which rose 21.5% year-over-year in the third quarter to $14.1 million, holding the Net Interest Margin (NIM) steady at a healthy 3.83%. For the full fiscal year 2025, the Trailing Twelve Months (TTM) revenue stood at approximately $67.71 million, with TTM net income at about $17.31 million. That's a solid performance.

Key Growth Drivers: Loan Expansion and Efficiency

The primary engine for Landmark Bancorp, Inc.'s near-term growth is their disciplined loan expansion, particularly in their sweet spot: community-based lending. In the second quarter of 2025, gross loans grew by $42.9 million, an annualized increase of 16%, led by strong demand in three key areas:

• Residential Mortgages: Up $21.5 million.
• Commercial Loans: Up $13.4 million.
• Commercial Real Estate (CRE): Up $10.9 million.

This focus on relationship-driven lending in a favorable local Kansas economy-where the unemployment rate is supportive-is their core product innovation. Plus, they are actively rolling out branch-based initiatives to intensify deposit gathering, which is crucial for funding future loan growth and managing their cost of funds. They're also seeing a nice lift in non-interest income from gains on mortgage loan sales and higher deposit-related fees, diversifying their revenue streams.

Strategic Positioning and Earnings Outlook

Landmark Bancorp, Inc. maintains a clear competitive advantage by focusing on operational discipline and a solid capital base, which gives them a defensive posture in a volatile market. The efficiency ratio-a measure of a bank's overhead compared to its revenue-improved significantly to 60.7% in Q3 2025 from 66.5% a year prior, largely due to realized savings from 2024 branch closures and lower consulting costs. This is operating leverage in action.

Their capital position remains robust, with leverage and total risk-based ratios of 9.2% and 13.6%, respectively, well above regulatory minimums. This stability is why the stock trades at a lower Price-to-Earnings (P/E) ratio of roughly 9.2x compared to the US Banks industry average of 11x-it's priced as a value play, trading below the DCF fair value of $28.10. Management is committed to investing in talent and infrastructure, supporting their Mission Statement, Vision, & Core Values of Landmark Bancorp, Inc. (LARK), which centers on community banking.

Looking ahead, while the company maintains a risk-averse stance, analysts are forecasting a full-year 2026 Earnings Per Share (EPS) of $2.34, suggesting continued profitability. The board's declaration of a $0.21 per share cash dividend and a 5% stock dividend in Q3 2025 reinforces their commitment to shareholder returns.

Your next step should be to monitor the credit quality, specifically the non-performing loans, which bear watching as the loan portfolio expands, but the overall picture is one of controlled, profitable growth. Finance: track Q4 loan origination mix by segment by the end of the year.