First Community beats estimates, announces 4.5% buyback
South Carolina lender extends dividend streak with 96th consecutive payout amid 36% annual earnings growth
First Community Corporation beat analyst expectations in its fourth quarter with earnings per share of $0.69, surpassing estimates of $0.65, as the South Carolina-based bank holding company demonstrated strong asset quality and expanding margins. Revenue reached $20.6 million, exceeding the $19.6 million consensus forecast, according to the company's quarterly regulatory filing.
The Lexington-based lender, which operates through its First Community Bank subsidiary, delivered full-year earnings per share of $2.47, representing a 36.5 percent increase from the previous year. Net income rose 37.6 percent, underscoring the bank's ability to grow profitability even as financial institutions navigate a challenging interest rate environment.
First Community's net interest margin expanded to 3.32 percent, marking the seventh consecutive quarter of improvement. The NIM metric, which measures the difference between what banks earn on loans and pay on deposits, has become a critical focus for investors as the Federal Reserve's rate cycle influences lending profitability across the banking sector.
The bank's asset quality stood out, with non-performing assets at just 0.02 percent—exceptionally low even by industry standards. This conservative approach to credit risk has positioned First Community to weather potential economic headwinds that have pressured smaller regional lenders.
First Community's board announced a $7.5 million share repurchase authorization, representing approximately 4.5 percent of the company's equity. The buyback program follows a year in which shares of the bank have traded within a 52-week range of $19.10 to $31.50, reflecting investor optimism about its growth trajectory.
The company maintained its quarterly dividend of $0.16 per share, marking the 96th consecutive quarter of payouts. The dividend streak represents 24 years of uninterrupted returns to shareholders, a rare achievement among community banks that highlights management's commitment to consistent capital allocation.
Analysts have taken notice of First Community's performance, with three analysts rating the stock a buy and setting an average target price of $32.67, according to market data. The bank currently trades at approximately 12 times earnings, below the forward price-to-earnings ratio of 11.64, suggesting room for multiple expansion if earnings momentum continues.
First Community's return on equity stood at 12.2 percent for the trailing twelve months, with a profit margin of 24.8 percent. The bank's operating margin of 36.4 percent reflects efficient operations despite the expense pressures facing many community institutions as they invest in digital capabilities and branch modernization.
The earnings beat and continued margin expansion come as regional banks face renewed scrutiny from investors following last year's turmoil in the sector. First Community's conservative balance sheet, evidenced by its minuscule non-performing asset ratio, and its consistent dividend payments position it as a potential beneficiary of the rotation toward higher-quality regional lenders.
With quarterly earnings growth of 34 percent year-over-year and revenue growth of 18.1 percent, First Community is outperforming many of its community banking peers. The bank's focus on small to medium-sized enterprises and professional clients in its South Carolina markets has provided a stable deposit base and loan demand that has proven resilient despite broader economic uncertainty.