First Community Corporation (FCCO) | Investment Case

1. Company Snapshot

1.a. Company Description

First Community Corporation operates as the bank holding company for First Community Bank which offers various commercial and retail banking products and services to small-to-medium sized businesses, professional concerns, and individuals.The company operates through Commercial and Retail Banking, Mortgage Banking, and Investment Advisory and Non-Deposit segments.Its deposit products include checking, NOW, savings, and individual retirement accounts; and demand deposits, as well as other time deposits, such as daily money market accounts and longer-term certificates of deposit.

The company's loan portfolio comprises commercial loans that consist of secured and unsecured loans for working capital, business expansion, and the purchase of equipment and machinery; consumer loans, including secured and unsecured loans for financing automobiles, home improvements, education, and personal investments; real estate construction and acquisition loans; and fixed and variable rate mortgage loans.It also provides other banking services, which include online banking, internet banking, cash management, safe deposit boxes, travelers checks, direct deposit of payroll and social security checks, and automatic drafts for various accounts.In addition, the company offers non-deposit investment products and other investment brokerage services; VISA and MasterCard credit card services; investment advisory services; and insurance services.

It operates 21 full-service offices located in the Lexington County, Richland County, Newberry County, Kershaw County, Greenville County, Anderson County, Pickens County, and Aiken County, South Carolina; and Richmond County and Columbia County, Georgia.The company was incorporated in 1994 and is headquartered in Lexington, South Carolina.

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1.b. Last Insights on FCCO

The recent 3-month performance of First Community Corporation was negatively impacted by a lack of significant catalysts. Despite strong earnings and revenue beats in Q4 2024, the company's stock price has not seen a substantial increase. The absence of notable mergers and acquisitions, new product launches, or significant changes in business conditions has contributed to this stagnation. Furthermore, the company's recent upgrades to a Zacks Rank #1 (Strong Buy) and inclusion in various value and income stock lists have not been enough to drive significant price appreciation.

1.c. Company Highlights

Last Price	30
Change Percentage	2.60%
Open	29.38
Previous Close	29.24
Market Cap ( Millions)	231
Volume	60338
Year High	30.11
Year Low	19.46
M A 50	27.72
M A 200	25.27

FCF Yield	5.10%
Dividend Yield	2.07%
ROE	2.98%
Debt / Equity	0.00%
Net Debt / EBIDTA	-90.32%
Price To Book	0.11
Price Earnings Ratio	12.36
Price To FCF	19.6
Price To sales	2.75
EV / EBITDA	7.62

2. Transcript Summary

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3. NewsRoom

First Community (FCCO) Reports Q3 Earnings: What Key Metrics Have to Say

Oct -22

Source: zacks.com

First Community (FCCO) Q3 Earnings and Revenues Top Estimates

Oct -22

Source: zacks.com

First Community Corporation Announces Third Quarter Results and Cash Dividend

Oct -22

Source: prnewswire.com

Here's Why Momentum in First Community (FCCO) Should Keep going

Sep -24

Source: zacks.com

First Community (FCCO) is on the Move, Here's Why the Trend Could be Sustainable

Sep -08

Source: zacks.com

Expansion Into Metro Atlanta Looks Promising For First Community Corporation

Aug -22

Source: seekingalpha.com

Best Value Stocks to Buy for July 28th

Jul -28

Source: zacks.com

Compared to Estimates, First Community (FCCO) Q2 Earnings: A Look at Key Metrics

Jul -23

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.06%)

6. Segments

Commercial and Retail Banking

Expected Growth: 8.5%

Strong loan growth driven by commercial real estate and residential mortgage lending, coupled with expansion in deposit base, fueled by competitive pricing and enhanced digital banking capabilities, contributing to 8.5% growth in Commercial and Retail Banking segment of First Community Corporation.

Eliminations

Expected Growth: 0.0%

With 0.0% growth, Eliminations from First Community Corporation is stagnant. Key fundamental drivers contributing to this flat growth include lack of innovation, intense competition, and inefficient cost structure. Additionally, the absence of strategic acquisitions and limited geographic diversification are hindering expansion.

Investment Advisory and Non-deposit

Expected Growth: 10.5%

First Community Corporation's 10.5% growth in Investment Advisory and Non-deposit is driven by increasing demand for wealth management services, strategic partnerships, and expansion into new markets. Additionally, the corporation's focus on digital transformation, enhanced customer experience, and diversified revenue streams have contributed to this growth.

Corporate Banking

Expected Growth: 9.5%

Strong loan growth driven by commercial and industrial lending, increased deposits from existing clients, and strategic expansion into new markets. Additionally, the corporation's focus on relationship-based banking, cross-selling initiatives, and efficient cost management have contributed to the 9.5% growth in corporate banking.

Mortgage Banking

Expected Growth: 8.0%

Strong loan origination volume, driven by low interest rates and government-backed loan programs, contributed to the 8.0% growth in Mortgage Banking at First Community Corporation. Additionally, the company's expanded digital platform and strategic partnerships enhanced customer experience, increasing mortgage applications and refinancing activities.

7. Detailed Products

Personal Banking

First Community Corporation offers a range of personal banking services, including checking and savings accounts, credit cards, personal loans, and mortgages.

Business Banking

First Community Corporation provides business banking services, including business checking and savings accounts, commercial loans, and cash management solutions.

Wealth Management

First Community Corporation offers wealth management services, including investment advice, portfolio management, and retirement planning.

Mortgage Lending

First Community Corporation provides mortgage lending services, including home purchase and refinance loans, construction loans, and home equity loans.

Insurance Services

First Community Corporation offers insurance services, including life insurance, disability insurance, and long-term care insurance.

Online Banking

First Community Corporation provides online banking services, including bill pay, fund transfers, and account management.

8. First Community Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for First Community Corporation is moderate due to the availability of alternative banking services from fintech companies and traditional banks.

Bargaining Power Of Customers

The bargaining power of customers is low for First Community Corporation as customers have limited negotiating power due to the bank's strong market position.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate for First Community Corporation as the bank relies on a few large suppliers for its technology and infrastructure needs.

Threat Of New Entrants

The threat of new entrants is high for First Community Corporation due to the increasing trend of digital banking and the ease of entry for fintech companies.

Intensity Of Rivalry

The intensity of rivalry is high for First Community Corporation due to the competitive nature of the banking industry and the presence of several established players.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	56.21%
Debt Cost	4.10%
Equity Weight	43.79%
Equity Cost	6.17%
WACC	5.01%
Leverage	128.38%

11. Quality Control: First Community Corporation passed 2 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

First Community

A-Score: 6.8/10

Value: 6.6

Growth: 5.6

Quality: 6.6

Yield: 5.0

Momentum: 8.5

Volatility: 8.3

1-Year Total Return ->

Home Federal Bancorp of Louisiana

A-Score: 6.7/10

Value: 7.4

Growth: 6.1

Quality: 7.4

Yield: 6.0

Momentum: 7.0

Volatility: 6.3

1-Year Total Return ->

First Capital

A-Score: 6.6/10

Value: 8.0

Growth: 5.7

Quality: 5.9

Yield: 6.0

Momentum: 8.5

Volatility: 5.7

1-Year Total Return ->

Peoples Financial Services

A-Score: 6.0/10

Value: 6.2

Growth: 4.3

Quality: 5.8

Yield: 8.0

Momentum: 5.0

Volatility: 6.7

1-Year Total Return ->

Seacoast Banking

A-Score: 5.6/10

Value: 4.3

Growth: 5.4

Quality: 6.1

Yield: 4.0

Momentum: 7.0

Volatility: 7.0

1-Year Total Return ->

First of Long Island

A-Score: 5.3/10

Value: 5.0

Growth: 3.1

Quality: 4.1

Yield: 8.0

Momentum: 3.0

Volatility: 8.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-4.29%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

5.01%

First Community Corporation - US3198351047

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on FCCO

1.c. Company Highlights

Weak Momentum

Average Quality

Average Yield

Revenues Beats

Earnings Beats

Fairly Valued

Lower Quality

Stable Momentum

Revenues Miss

Average Growth

Strong Momentum

Medium Volatility

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.06%)

6. Segments

Commercial and Retail Banking

Expected Growth: 8.5%

Eliminations

Expected Growth: 0.0%

Investment Advisory and Non-deposit

Expected Growth: 10.5%

Corporate Banking

Expected Growth: 9.5%

Mortgage Banking

Expected Growth: 8.0%

7. Detailed Products

Personal Banking

Business Banking

Wealth Management

Mortgage Lending

Insurance Services

Online Banking

8. First Community Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: First Community Corporation passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

30.0$

Current Price

30$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA