Breaking Down Stock Yards Bancorp, Inc. (SYBT) Financial Health: Key Insights for Investors

You're looking at Stock Yards Bancorp, Inc. (SYBT) right now, trying to figure out if this regional bank's steady performance can weather the current economic shifts, and honestly, the Q3 2025 numbers give us a clear, defintely strong signal. The bank just posted a record net income of $36.2 million, translating to a diluted earnings per share (EPS) of $1.23, which comfortably beat the consensus estimates. This isn't just a fluke quarter; it's driven by a robust 10% year-over-year loan growth, pushing total loans to $6.93 billion as of September 30, 2025, plus their net interest margin (NIM) expanded to a healthy 3.56%. That's a rock-solid balance sheet, with total assets sitting at $9.31 billion, and the annualized return on average equity (ROE) is strong at 14.16%, showing they're using your capital efficiently. We need to dig into how they're maintaining this credit quality while growing loans so fast, especially with the dividend recently hiked to $0.32 per share, but the headline is simple: this regional player is executing a textbook growth strategy.

Revenue Analysis

You want to know where the money is coming from at Stock Yards Bancorp, Inc. (SYBT), and the quick answer is simple: it's a bank, so lending is the engine. But the real story in 2025 is the outsized growth in their core lending business, which is significantly outpacing their fee-based income. The total revenue for the third quarter of 2025 hit a strong $101.5 million, beating analyst expectations.

For a full-year perspective, the company's projected total revenue for the 2025 fiscal year is approximately $400.17 million. This translates to an estimated year-over-year revenue growth rate of about 16.82% compared to the 2024 total of $342.55 million. That's a healthy clip, defintely showing their regional strategy across Kentucky, Indiana, and Ohio is working.

Here's the quick math on the Q3 2025 revenue breakdown, which shows the clear dominance of their lending operations:

• Net Interest Income (NII): This is the profit from loans minus the cost of deposits. It was $77.04 million, representing about 75.9% of total revenue.
• Non-Interest Income: This covers all the fee-based services. It was $24.48 million, making up the remaining 24.1% of total revenue.

The primary revenue streams for Stock Yards Bancorp, Inc. are split into these two categories, but the growth story is all about the NII. Net Interest Income saw a massive year-over-year increase of 18.6% in Q3 2025. This huge jump is directly tied to robust loan production-total loans were up 13% year-over-year in Q2 2025-plus an expanded net interest margin (NIM) which reached 3.56% in Q3 2025. It's a classic bank growth driver: more loans at better rates.

The non-interest income segment, while smaller, is still crucial for diversification and includes several key services. This segment provides a more stable, fee-based revenue source that is less sensitive to interest rate swings, though it has seen some minor fluctuations.

What this breakdown hides is the composition of that non-interest income. It's not just one thing. It includes Wealth Management & Trust (WM&T) services, which is a major focus, plus treasury management, brokerage services, and mortgage banking. While non-interest income saw a slight decrease compared to the prior year, the growth in areas like treasury management and brokerage services is a positive sign for fee-based stability. If you want a deeper dive into the balance sheet strength behind these numbers, check out Breaking Down Stock Yards Bancorp, Inc. (SYBT) Financial Health: Key Insights for Investors.

The clear action here is to keep watching the Net Interest Margin. A strong NIM of 3.56% is great, but any potential interest rate cuts by the Federal Reserve could pose a challenge to that critical revenue stream going forward. For now, the revenue engine is running hot on loan growth. That's the main takeaway.

Profitability Metrics

You need to know if Stock Yards Bancorp, Inc. (SYBT) is just growing revenue or if that growth is actually translating into shareholder profit. The direct takeaway is that SYBT's profitability is exceptionally strong, marked by a high Net Interest Margin (NIM) and an efficiency ratio that outperforms the general industry target, indicating superior cost control.

For a bank, the traditional Gross Profit is best represented by Net Interest Income (NII), which is the spread they earn on loans versus what they pay on deposits. In the third quarter of 2025, SYBT reported NII of $77.037 million against total revenue of $101.5 million. This means their gross margin, or Net Interest Income as a percentage of total revenue, was approximately 75.9%.

The company's ability to turn revenue into bottom-line profit is impressive. Here's the quick math on the key profitability margins for the third quarter ended September 30, 2025:

• Gross Profit Margin (NII/Revenue): 75.9%
• Operating Profit Margin (Pre-Tax Proxy): Approximately 45.0%
• Net Profit Margin: 35.7% (Based on net income of $36.2 million on $101.5 million in revenue)

This 35.7% net margin is a powerful signal of a lean, high-value business model. You're looking at a bank that is very good at keeping what it earns.

Profitability Trends and Industry Comparison

SYBT has demonstrated a clear upward trend in profitability, which is a major green flag, especially in a volatile rate environment. The annualized Return on Average Assets (ROAA) stood at 1.56% and the annualized Return on Average Equity (ROAE) was 14.16% for Q3 2025.

To be fair, the regional banking sector has faced margin pressure in 2025, with industry analysts projecting the average Net Interest Margin (NIM) to compress to around 3.0% by year-end. SYBT, however, has managed to expand its NIM to 3.56% in Q3 2025, up from 3.33% a year prior. This places them squarely within the high-end range for community banks, which typically see NIMs between 3.5% and 4.5%. This expansion is a testament to their effective asset-liability management, specifically their strong loan growth and higher yields on interest-earning assets.

Operational Efficiency and Cost Management

Operational efficiency is where SYBT truly shines, and it's what drives that high net margin. The bank's efficiency ratio-non-interest expense divided by net revenue-is a critical measure of cost management. In Q3 2025, SYBT's efficiency ratio improved to 52.99%, down from 53.92% in the prior year quarter. A lower number is better, and top-performing banks often aim for ratios below 50%. SYBT is right on the heels of that top tier, and their ratio is comfortably better than the general industry target of below 60%.

Here's the quick math: They spent $53.831 million on non-interest expenses in Q3 2025. The continuous improvement in this ratio shows management is effectively scaling its revenue-generating activities-like its Wealth Management and Trust Group, which is a significant source of fee income-faster than its operating costs. This focus on operational excellence is a core part of their strategy; you can read more about it in their Mission Statement, Vision, & Core Values of Stock Yards Bancorp, Inc. (SYBT).

Debt vs. Equity Structure

You want to know if Stock Yards Bancorp, Inc. (SYBT) is leaning too heavily on borrowed money. The short answer is no: the bank maintains a very conservative capital structure, relying far more on shareholder equity than debt to fund its operations and growth.

As of the most recent reporting in 2025, Stock Yards Bancorp, Inc.'s total debt stood at approximately $326.81 million, balanced against a robust equity capital and reserves figure of $973.52 million. This is a healthy, low-leverage position for a regional bank, especially given the current interest rate environment.

The clearest indicator of this conservative approach is the Debt-to-Equity (D/E) ratio. This metric tells you how much debt a company uses for every dollar of shareholder equity (the money the owners put in). Here's the quick math:

• Stock Yards Bancorp, Inc.'s D/E Ratio (2025): 0.32
• Regional Banks Industry Average D/E Ratio (2025): Approximately 0.50

A ratio of 0.32 means the bank has only 32 cents of debt for every dollar of equity. To be fair, banks often run higher D/E ratios than other industries because their core business is borrowing (deposits and wholesale funding) to lend. But even within the 'Banks - Regional' sector, where the average D/E is around 0.50, Stock Yards Bancorp, Inc. is defintely on the lower-risk side. A D/E ratio under 1.5 is generally considered desirable, so their 0.32 is a sign of exceptional balance sheet strength.

The company's financing strategy is clearly weighted toward equity funding and deposits over long-term debt, which is a major positive for stability. While the total debt of $326.81 million includes both short-term and long-term obligations, the overall low D/E ratio suggests this debt is manageable and not a strain on capital. This is further supported by the bank's strong capital ratios, including a tangible common equity to tangible assets ratio of 8.44% reported in early 2025, which is a key measure of capital strength.

What this estimate hides is the dynamic nature of a bank's funding. Instead of a major new bond issuance (a common form of long-term debt), the primary shift in financing has been on the deposit side. Over the 12 months leading up to the third quarter of 2025, deposit balances expanded by $918 million, or 14%. However, the mix is shifting from non-interest bearing to higher-cost deposits, meaning the cost of funding is rising, even if the balance sheet remains strong. This focus on deposits and strong retained earnings is how the bank balances its capital needs, prioritizing a lower-risk funding profile over aggressive debt financing.

The conservative debt posture aligns with the bank's long-term strategic view, which you can read more about here: Mission Statement, Vision, & Core Values of Stock Yards Bancorp, Inc. (SYBT).

Liquidity and Solvency

You need to know if Stock Yards Bancorp, Inc. (SYBT) can meet its short-term obligations, and for a bank, that means looking beyond the traditional Current Ratio. The core of a bank's liquidity is its funding base (deposits) versus its lending activity (loans), plus the cash flow generated from operations. The good news is that SYBT maintains a healthy, well-capitalized position, with a key liquidity ratio sitting at a manageable level.

For a commercial bank, the standard Current and Quick Ratios are defintely less useful because their primary 'current assets' are loans and 'current liabilities' are customer deposits. Instead, we look at the Loan-to-Deposit Ratio (LDR) and the stability of the deposit base. As of September 30, 2025, SYBT's total loans of $6.93 billion were funded by total deposits of $7.64 billion, resulting in a Loan-to-Deposit Ratio of approximately 90.7%. This ratio is solid; it shows they are lending aggressively but not over-leveraging their core deposit funding base.

• LDR of 90.7% indicates strong deposit coverage for loans.
• Tangible Common Equity to Tangible Assets ratio was 9.16% in Q3 2025.
• The company is classified as 'well-capitalized,' the highest regulatory capital rating.

Analysis of Funding and Working Capital Trends

The trend in working capital-which is really the deposit mix for a bank-shows a shift, but total funding is growing. Over the 12 months leading up to September 30, 2025, total deposit balances expanded by $918 million, or 14%. This is a clear strength, as it shows continued customer confidence and growth in the funding base. The caveat is the mix: interest-bearing deposits grew faster, led by time deposit growth, indicating a higher cost of funds, which is a near-term margin pressure point.

This shift is a direct result of the higher interest rate environment. To be fair, every bank is dealing with this. The positive is that SYBT's Net Interest Margin (NIM) still expanded to 3.56% in Q3 2025, suggesting they are managing to earn more on their assets than they are paying out on their liabilities, despite the cost increase. You can learn more about the strategic direction that supports this growth by reviewing the Mission Statement, Vision, & Core Values of Stock Yards Bancorp, Inc. (SYBT).

Cash Flow Statements Overview (TTM Sep 2025)

Reviewing the cash flow statement tells us exactly how SYBT is funding its growth. The three components-Operating, Investing, and Financing-paint a clear picture of a bank focused on loan expansion.

Here's the quick math on the Trailing Twelve Months (TTM) cash flow ending September 30, 2025, in millions USD:

The $132.87 million in positive Operating Cash Flow is the engine. The large Investing Cash Flow outflow of $406.02 million is not a concern; it's the cost of doing business for a growing bank, representing the net cash invested into new loans and other assets. The bank is funding this loan growth by utilizing cash from its investment portfolio and attracting new deposits, a healthy cycle. The Financing activities show confidence in the future, as the board increased the quarterly cash dividend to $0.32 per common share in August 2025.

Potential Liquidity Strengths and Actions

The primary strength is the stable, growing deposit base and the high regulatory capital rating. The Loan-to-Deposit Ratio is manageable, meaning they are not overly reliant on more volatile, non-deposit funding sources. The key action for you as an investor is to monitor the cost of funds and the Net Interest Margin. If the NIM starts to contract sharply from its current 3.56%, it signals that the cost of deposits is outpacing the yield on new loans, which would be a near-term risk. Still, for now, the liquidity position is robust.

Valuation Analysis

The short answer to whether Stock Yards Bancorp, Inc. (SYBT) is overvalued or undervalued is that it appears to be trading at a slight premium to its book value but at a discount relative to its earnings growth, suggesting it is currently fairly valued with an upside potential. The stock is trading near its 52-week low, which presents an opportunity if you believe in the bank's core earnings power.

As of November 20, 2025, the stock price sits at approximately $64.44, a significant drop from its 52-week high of $83.83. The stock has decreased by -15.56% over the last 12 months, which is a clear headwind, but the underlying earnings remain strong.

Here's the quick math on the key valuation multiples, which show a mixed picture:

• Price-to-Earnings (P/E) Ratio: The trailing P/E ratio is 13.70. This is a reasonable multiple for a regional bank with a solid growth profile, especially when the forward P/E drops slightly to 13.34, indicating expected earnings growth.
• Price-to-Book (P/B) Ratio: The P/B ratio is 1.88. This is above the industry average for US regional banks, which often trade closer to 1.0x to 1.5x, suggesting investors are willing to pay a premium for its asset quality and management.
• Price-to-Tangible Book Value (P/TBV): The Tangible Book Value per Share (TBVPS) was $28.30 as of Q3 2025. This gives us a P/TBV of approximately 2.28x ($64.44 / $28.30), which is a substantial premium, but it reflects the value of their non-interest income businesses, like Wealth Management and Trust, that don't rely on physical assets.

What this estimate hides is that for a bank, the Enterprise Value-to-EBITDA (EV/EBITDA) ratio is less useful than these banking-specific metrics. Banks are not valued on EBITDA because their capital structure and interest expense are core to their business model, unlike a typical industrial company. We defintely stick to P/E and P/B here.

Stock Yards Bancorp, Inc. (SYBT) is a strong dividend payer, making it attractive for income-focused investors. The board increased the quarterly cash dividend to $0.32 per common share in August 2025, bringing the forward annual dividend to $1.28. This translates to a forward dividend yield of 2.04%. The forward payout ratio is a very sustainable 27.29%, meaning the company has plenty of room to cover the payment and reinvest in growth.

The analyst consensus on the stock is currently a Neutral rating. The average 12-month price target is set at $76.60, which represents an upside of about 18.87% from the current price. This consensus suggests that while the bank is fundamentally sound, the regional banking sector faces near-term macroeconomic uncertainty, tempering a stronger 'Buy' rating. You can read more about the company's long-term strategy in their Mission Statement, Vision, & Core Values of Stock Yards Bancorp, Inc. (SYBT).

Here is a summary of the key valuation metrics for a quick comparison:

Actionable Insight: The stock's valuation is not screaming cheap, but the price drop combined with the strong forward P/E and sustainable dividend makes it a compelling 'Hold' with a bias toward 'Buy' on any further dips toward the $60.75 low.

Risk Factors

You've seen the impressive growth-like the Q3 2025 net income of $36.2 million-but a seasoned investor knows you have to look past the headline numbers to the risks. For Stock Yards Bancorp, Inc. (SYBT), the near-term outlook is solid, but the key risks center on market-driven financial volatility and the ever-present threat of digital compromise.

The company is doing a lot right, maintaining its 'well-capitalized' status, the highest regulatory rating, with a tangible common equity ratio of 9.16% as of September 30, 2025. Still, regional banks like Stock Yards Bancorp, Inc. are not immune to external pressures or specific operational challenges.

Operational and Financial Headwinds

The biggest operational risk today is cybersecurity. As Stock Yards Bancorp, Inc. expands its digital offerings to keep pace with larger competitors, its exposure to sophisticated cyber-attacks increases. A breach could instantly erode customer trust and carry significant financial liability, which is why they are defintely investing in preventive tools and employee training. It's a constant, high-stakes arms race.

On the financial side, the main vulnerability is tied to capital markets volatility, specifically within their Wealth Management and Trust (WM&T) division. Here's the quick math: WM&T income makes up about 45% of the bank's non-interest income. If the stock market takes a significant downturn, the value of their Assets Under Management (AUM) drops, and so does that non-interest fee revenue. It's a direct hit to the top line.

• Cyber-attacks: Reputational and financial liability risk.
• WM&T AUM decline: Direct hit to non-interest income.
• Credit market volatility: Pressure on loan repayment ability.

External Market and Strategic Risks

External risks for Stock Yards Bancorp, Inc. are primarily driven by the macroeconomic environment and competition. While the bank's traditional credit quality metrics remain strong-the allowance for credit losses to loans stood at a healthy 1.33% as of September 30, 2025-a prolonged economic slowdown would test that. Volatility in capital and credit markets can quickly impact the creditworthiness of borrowers, especially commercial clients.

Also, the strategic risk of capital allocation is worth watching. Despite strong earnings momentum, recent analyst commentary has noted a period of buyback inactivity. This can raise questions about management's priorities for returning capital to shareholders, which might temper near-term share price catalysts. The bank is focused on its core growth strategy, which you can read more about here: Mission Statement, Vision, & Core Values of Stock Yards Bancorp, Inc. (SYBT).

To be fair, the company's capital position is a significant mitigation strategy in itself. The strong capital ratios provide a substantial buffer against unexpected credit losses or market shocks. Their Net Interest Margin (NIM) of 3.56% in Q3 2025 shows their core lending business is performing well, which helps absorb other pressures.

Growth Opportunities

You want to know where Stock Yards Bancorp, Inc. (SYBT) is heading, and the short answer is: continued, deliberate expansion backed by strong core banking metrics. The bank isn't chasing risky growth; it's deepening its footprint in high-value, contiguous markets while focusing on fee-based income streams like Wealth Management & Trust (WM&T).

The company's primary growth engine is its strategic geographic expansion, which is defintely working. As of September 30, 2025, total assets stood at $9.31 billion, fueled by strong organic growth. Total loans increased an impressive 10% over the last 12 months, with Commercial Real Estate (CRE) being the largest contributor. Plus, they're physically expanding, with two new branches slated to open in 2025-Bardstown, Kentucky, and Liberty Township, Ohio, a suburb of Cincinnati-to capitalize on that regional momentum.

Here's the quick math on what analysts are expecting for the near term. While the pace of growth is expected to moderate slightly after a strong 2025, the trajectory remains positive. The consensus revenue projection for the 2025 fiscal year is $400.17 million, with earnings per share (EPS) expected to hit $4.78. Looking ahead to 2026, revenue is projected to grow to $421.91 million, a solid 5.43% increase. That's a steady, predictable climb.

• Drive loan growth across all existing markets.
• Expand the physical branch network strategically.
• Boost fee income from Wealth Management & Trust.

The non-interest income side is also a key initiative. Wealth Management & Trust saw its Assets Under Management (AUM) expand for the second consecutive quarter in Q3 2025, a direct result of key hires and a reloaded sales team. In terms of capital allocation, the board approved a new share repurchase program in July 2025, authorizing the buyback of up to one million shares, which is about 3.4% of outstanding stock. This signals management's confidence in the stock's value and is a smart, flexible way to return capital to shareholders.

Stock Yards Bancorp, Inc.'s competitive advantage in the regional banking space is clear: a strong core banking operation and attractive valuation. The bank's Price-to-Earnings (P/E) ratio of 14.2x is noticeably lower than its peer group average of 19.5x, suggesting the market might not be fully recognizing its consistent earnings growth. You can read more about what drives institutional interest in the company here: Exploring Stock Yards Bancorp, Inc. (SYBT) Investor Profile: Who's Buying and Why?

What this estimate hides is the potential impact of interest rate changes, which could challenge the net interest margin. Still, the company's Q3 2025 net income of $36.2 million and solid loan/deposit growth show its core banking strengths are intact. For a quick view of the financial forecasts:

Your next step is simple: Review the Q4 2025 guidance once it's released to confirm the expected EPS of approximately $1.20 (Dec 2025 consensus is $1.20) and see if the new branch openings are on schedule for early 2026 contribution.