PINE BLUFF, Ark. - Simmons First National Corporation (NASDAQ: SFNC) declared on Tuesday that CEO Robert "Bob" Fehlman will retire at the end of 2024. George Makris, Jr., the current Executive Chairman, is set to take over as Chairman and CEO on January 1, 2025. Concurrently, the company welcomed Christopher Van Steenberg as the new Chief Operating Officer.
Fehlman, who has been with Simmons for over 36 years, will remain in his role until his retirement and will serve in an advisory capacity through the first quarter of 2025. Makris, who led the company from 2014 to 2022, will resume leadership responsibilities. During his tenure, Fehlman held various positions, including controller, chief financial officer, and president, contributing significantly to the bank's growth initiatives.
Simmons also introduced Van Steenberg as the new COO. He brings over 25 years of financial services experience and joins from a Mid-South bank where he managed treasury, digital and product services, and strategy execution. Van Steenberg's appointment is effective immediately, and he will be reporting to Simmons' President Jay Brogdon.
Simmons Bank, a subsidiary of Simmons First National Corporation, operates 234 branches across six states and has a history of paying cash dividends to shareholders for 115 consecutive years. The bank has been recognized for its workplace environment and service excellence, receiving accolades from U.S. News & World Report and Forbes in 2024.
The announcement of these executive changes is based on a press release statement from Simmons First National Corporation.
In other recent news, Simmons First National reported its third-quarter earnings with an adjusted GAAP earnings per share (EPS) of $0.20, falling short of the consensus estimate of $0.33. Baird, in response to these figures, raised the price target for Simmons First National to $24, maintaining a neutral stance on the stock. The bank's earnings were affected by significant items such as a $28.4 million loss from the sale of securities and approximately $0.4 million in non-core expenses.
Notwithstanding these factors, Simmons First National has shown early success in repricing its deposits following the initial Federal Reserve rate cut. According to Baird, the bank's net interest margin (NIM) and net interest income (NII) are expected to improve due to strong asset and liability repricing tailwinds coupled with modest loan growth.
Recent developments also include the bank's strategic initiatives to manage deposit costs, which decreased ahead of a 50 basis point rate cut in September. Simmons First National anticipates a stable net interest margin in the fourth quarter, with potential improvements in 2025 depending on Federal Reserve actions. The bank is also consolidating branches and reallocating savings towards revenue-generating initiatives, aiming for a reduction in core expenses.
InvestingPro Insights
As Simmons First National Corporation (NASDAQ: SFNC) undergoes this significant leadership transition, it's worth noting some key financial insights that shed light on the company's current position and recent performance.
According to InvestingPro data, SFNC has a market capitalization of $3.16 billion, reflecting its substantial presence in the banking sector. The company's price-to-book ratio of 0.9 suggests that it may be undervalued relative to its assets, which could be of interest to value-oriented investors considering the upcoming leadership changes.
One of the standout InvestingPro Tips is that SFNC has maintained dividend payments for an impressive 51 consecutive years, underscoring the company's commitment to shareholder returns mentioned in the article. This consistency aligns with the bank's reported 115-year history of paying cash dividends. Additionally, SFNC has raised its dividend for 12 consecutive years, demonstrating a track record of growing shareholder value.
The company's stock has shown remarkable strength recently, with a 77.34% total return over the past year and a 43.62% return in the last six months. This performance, coupled with the fact that SFNC is trading near its 52-week high (97.03% of the high), indicates strong investor confidence leading up to the announced executive changes.
While the company faces challenges, such as weak gross profit margins, it's encouraging to note that 4 analysts have revised their earnings upwards for the upcoming period. This positive outlook could bode well for the incoming leadership team.
For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for SFNC, providing a deeper understanding of the company's financial health and market position as it navigates this leadership transition.
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