3/8/25
First Community Bankshares, Inc. (FCBC) is a regional bank holding company based in Bluefield, Virginia. It owns and operates First Community Bank, a financial institution serving communities across Virginia, West Virginia, North Carolina, and Tennessee. Unlike the big banks that dominate the headlines, FCBC focuses on traditional banking—think commercial and consumer loans, deposit services, and wealth management.
For investors seeking steady dividends, this is a stock that has quietly built a reputation for reliability. While the financial sector as a whole has seen ups and downs due to shifting interest rates and economic uncertainty, FCBC has stayed the course. The stock currently trades at $39.33, with a market cap of $718.58 million, and continues to reward shareholders with consistent dividend payments.
Key Dividend Metrics
🟢 Dividend Yield: 3.16%
💰 Annual Dividend Payout: $1.24 per share
📅 Most Recent Dividend Payment: February 28, 2025
⏳ Ex-Dividend Date: February 14, 2025
🟢 Payout Ratio: 42.86% (Moderate and Sustainable)
📈 5-Year Average Dividend Yield: 3.66%
Dividend Overview
One of the standout qualities of FCBC is its steady dividend payments. With a yield of 3.16%, the stock provides a reliable income stream for investors, though it’s slightly below its five-year average of 3.66%. The slight dip in yield suggests that the stock has been trading at a premium, which is worth noting for those looking to buy in at an attractive valuation.
What really makes FCBC’s dividend appealing is its sustainability. The payout ratio sits at 42.86%, a comfortable level that leaves plenty of room for future increases. This means the company isn’t overextending itself to pay dividends—it’s using earnings responsibly while still rewarding investors.
The most recent dividend was paid on February 28, 2025, and the company’s long-standing commitment to consistent distributions suggests that shareholders can expect these payouts to continue without interruption.
Dividend Growth and Safety
Growth
While FCBC isn’t a rapid dividend grower, it has managed to increase payouts gradually over time. The company takes a conservative approach, ensuring that dividends rise alongside earnings rather than stretching to make unsustainable increases.
With earnings per share at $2.80, there’s ample room for the company to continue raising dividends while still reinvesting in its core banking business.
Safety
The strength of FCBC’s dividend isn’t just in its payout ratio—it’s in the overall health of the company. Some of the biggest risks to bank dividends come from financial instability, but FCBC is well-positioned to weather economic fluctuations.
- Profit margins are strong, with a net margin of 31.8% and an operating margin of 42.82%.
- The balance sheet looks solid, with only $1.42 million in total debt.
- Cash reserves are impressive, sitting at $377.45 million, giving the company a cushion in case of economic downturns.
One potential concern is that revenue declined by 2.2% year-over-year in the most recent quarter. However, earnings still grew by 10.7%, showing that the company has managed costs effectively despite a slight revenue dip.
Chart Analysis
Price Action and Moving Averages
The chart shows that FCBC had a strong upward move in the middle of the past year, climbing steadily before peaking near $50. After hitting that high, the stock entered a period of volatility, forming a series of lower highs and lower lows. Over the past few months, the price has been trending downward, breaking below both the 50-day moving average (blue line) and now sitting right near the 200-day moving average (purple line).
Right now, the stock is in a critical area. The 200-day moving average often acts as long-term support, and FCBC is testing that level. If it holds, the stock could consolidate here before making another attempt to move higher. However, if it breaks below this level with conviction, it could signal further downside.
Volume and Market Interest
Volume tells an important part of the story. While there were periods of elevated trading during the rally last year, volume has generally tapered off in recent months. The recent spike in volume, particularly on red bars, suggests selling pressure is picking up. When volume rises on down days, it typically means sellers are in control.
For a meaningful reversal, we would want to see green volume bars picking up, showing renewed buying interest. Right now, that hasn’t happened yet, which suggests caution.
Relative Strength Index (RSI) and Momentum
The RSI, shown at the bottom of the chart, has been trending lower and is now sitting near oversold territory. This indicates the stock may be approaching a level where buyers could step in, but it doesn’t guarantee a reversal. A bounce in RSI along with strong buying volume would be a more convincing sign that momentum is shifting.
If RSI continues to weaken and falls deeper into oversold territory, it could suggest that FCBC still has room to fall before finding solid support.
Recent Candlestick Action
Looking at the last few candles, the price action has been indecisive. The stock closed at $39.33, with a high of $39.46 and a low of $38.88, meaning it traded within a relatively tight range. The past few candles also show some long upper wicks, which indicate selling pressure whenever the stock attempts to move higher. That’s not a great sign for bulls, as it suggests sellers are still stepping in to push the price back down.
If FCBC can reclaim the 50-day moving average, that would be a more bullish sign. Until then, the stock is in a wait-and-see mode, hovering near a key level of support.
Analyst Ratings
In recent times, First Community Bankshares, Inc. (FCBC) has received varied assessments from analysts, reflecting both optimism and caution regarding its performance.
Upgrades
- February 3, 2021 🟢 Piper Sandler upgraded FCBC from “Neutral” to “Overweight.” This upgrade was based on the firm’s recognition of FCBC’s robust financial health and promising growth prospects at that time.
Downgrades
- January 31, 2022 🔴 Piper Sandler downgraded FCBC from “Overweight” to “Neutral,” adjusting the price target from $37 to $35. This change reflected concerns about potential challenges in the banking sector that could impact FCBC’s performance.
- July 31, 2023 🟠 Piper Sandler maintained an “Underweight” rating but raised the price target from $28 to $33, indicating a cautious stance despite acknowledging some positive factors.
Consensus Price Target
📊 As of the latest available data, the consensus among analysts for FCBC’s price target is approximately $38.00. This reflects a balanced view, considering both the bank’s strengths and the challenges it may face in the current economic environment.
Earnings Report Summary
First Community Bankshares, Inc. (FCBC) recently shared its latest earnings results, and the numbers tell a story of steady performance with a few areas of softness.
Steady Profit Growth
The company reported net income of $13.04 million for the fourth quarter of 2024, which works out to $0.71 per share. That’s a solid 10.65% jump compared to the same time last year. Over the full year, FCBC earned $51.60 million, or $2.80 per share, showing a steady 7.46% increase.
Interest Income and Margin Trends
One of the key takeaways from the report is that net interest income dipped slightly by about $730,000 compared to last year’s fourth quarter. That was mainly because the bank had to pay more on deposits as interest rates remained high. The net interest margin, which measures how much profit the bank makes on lending, came in at 4.36%, down just a bit from last year. While the bank earned more on loans, higher funding costs offset those gains.
Noninterest Income and Expenses
FCBC saw a small drop in noninterest income—things like fees and service charges—down about 1.19% from last year. On the bright side, expenses fell by nearly 10%, thanks to lower legal costs compared to a big one-time expense in the previous year.
Return on Assets and Equity Improving
Profitability is moving in the right direction. The bank’s return on assets (ROA) was 1.60% for both the quarter and the full year, an improvement from 1.43% in the fourth quarter of 2023. Return on equity (ROE), which measures how well the bank uses shareholder funds, came in at 9.89% for the quarter and 10.03% for the year—again, a step up from last year.
Balance Sheet and Lending Activity
The bank ended 2024 with total assets of $3.26 billion. Loans declined by 6.07%, and investment securities were down nearly 40% as the company adjusted its holdings. Deposits slipped slightly by 1.14%, but a major highlight was cash reserves, which soared by an impressive 224%.
Loan Quality and Reserves
One area to watch is loan performance. Non-performing loans ticked up to 0.83% of total loans, and charge-offs increased compared to last year. The bank has set aside more funds for potential loan losses, with reserves now covering 1.44% of total loans, up slightly from 1.41% last year.
Dividend News
For income investors, FCBC announced a quarterly dividend of $0.31 per share, keeping its impressive 40-year streak of dividend payments alive. On top of that, the board declared a special dividend of $2.07 per share, rewarding shareholders with an extra payout thanks to the company’s strong capital position.
Capital Management Strategy
FCBC continues to balance its earnings between dividends, share buybacks, and growth. Over the last four years, it has earned nearly $200 million, with about $80 million paid out in regular dividends and another $82 million spent on share repurchases. Even after the special dividend, management believes there’s plenty of capital left for future growth and strategic initiatives.
Overall, FCBC wrapped up the year with steady earnings growth, disciplined expense management, and a strong capital position. While higher deposit costs and rising loan charge-offs are something to keep an eye on, the bank remains focused on long-term shareholder returns.
Financial Health and Stability
FCBC operates in a way that prioritizes stability over aggressive expansion. The bank has built a strong reputation in the communities it serves, and its financials reflect that conservative approach.
- Return on Assets (ROA) is 1.58%, and Return on Equity (ROE) stands at 10.02%, showing that the company is using its capital effectively.
- The bank’s total assets significantly outweigh its liabilities, reinforcing financial security.
- Profitability remains strong, even in a challenging economic environment.
While revenue has dipped slightly, the fact that earnings are still growing indicates that the company is managing expenses wisely. That’s a sign of a well-run business, especially in an industry where external factors like interest rates can impact profitability.
Valuation and Stock Performance
At 14.01 times trailing earnings, FCBC isn’t the cheapest bank stock out there, but it’s not expensive either. Historically, the stock has traded in the 10-13x earnings range, meaning it’s currently sitting at the higher end of its valuation spectrum.
Looking at other valuation metrics:
- Price-to-Book (P/B) Ratio: 1.37, slightly above historical norms.
- Price-to-Sales (P/S) Ratio: 4.63, which is higher than its five-year average.
Performance-wise, the stock has done well over the past year, climbing 18.54%, compared to the S&P 500’s gain of 12.74%. That’s a sign that investors are confident in the company, but it’s also a reason to be cautious—when a stock outpaces the market, it sometimes means it’s due for a pullback.
One notable factor is that FCBC is trading below its 52-week high of $49.02. That suggests the stock has cooled off a bit, and its current consolidation around the 50-day and 200-day moving averages near $41.50 indicates that investors are waiting for a clearer direction.
Risks and Considerations
While FCBC has a lot going for it, no stock is without risks. Here are some factors to keep an eye on:
- Interest Rate Sensitivity – As a regional bank, FCBC’s profitability is closely tied to interest rates. If rates fall sharply, the bank’s net interest margin could shrink, impacting earnings.
- Revenue Decline – The 2.2% drop in revenue isn’t alarming on its own, but if this trend continues, it could pressure the company’s ability to grow dividends in the future.
- Limited Growth Potential – FCBC is a stable bank, but it’s not a high-growth company. Investors looking for strong capital appreciation might find better opportunities elsewhere.
- Economic Conditions – The banking industry as a whole is cyclical. While FCBC has been a steady performer, any major economic downturn could weigh on its stock price.
- Low Trading Volume – With an average daily volume of around 39,000 shares, FCBC isn’t the most liquid stock. Large investors might find it difficult to enter or exit positions without impacting the stock price.
Final Thoughts
FCBC is the kind of stock that appeals to investors looking for steady, reliable dividend income. It won’t make headlines with explosive growth, but it has a solid history of paying out dividends without stretching its balance sheet.
The combination of a sustainable payout ratio, strong cash reserves, and conservative management makes this an attractive option for income-focused investors. While the stock is trading at a slightly elevated valuation compared to its historical norms, it remains a well-run company with a proven track record.
For those seeking dependable income in the banking sector, FCBC is a stock worth considering.
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