Old National Bancorp (ONB) | Investment Case

1. Company Snapshot

1.a. Company Description

Old National Bancorp operates as the bank holding company for Old National Bank that provides various financial services to individual and commercial customers in the United States.It accepts deposit accounts, including noninterest-bearing demand, interest-bearing checking, negotiable order of withdrawal, savings and money market, and time deposits; and offers loans, such as home equity lines of credit, residential real estate loans, consumer loans, commercial loans, commercial real estate loans, letters of credit, and lease financing.The company also provides debit and automated teller machine cards, telephone access, online banking, and other electronic and mobile banking services; cash management, private banking, brokerage, trust, investment advisory, and other traditional banking services; wealth management, investment, and foreign currency services; and treasury management, merchant, health savings, and capital markets services, as well as community development lending and equity investment solutions.

As of December 31, 2021, it operated a total of 162 banking centers located primarily in the states of Indiana, Kentucky, Michigan, Minnesota, and Wisconsin.Old National Bancorp was founded in 1834 and is headquartered in Evansville, Indiana.

Show Full description

1.b. Last Insights on ONB

Old National Bancorp's recent performance was negatively impacted by expectations of plateauing earnings after the Bremer acquisition. The company's loan balance surged 31% in Q2 2025, but is expected to stabilize for the next year and a half. Earnings per share growth is anticipated to slow, with a 28% growth to $2.15 in 2025 and 29% growth to $2.77 in 2026. Additionally, the company's upcoming earnings report is not expected to beat estimates, according to Zacks Consensus Estimate. (Source: Old National Bancorp: Earnings Likely To Plateau After Bremer Acquisition, Maintain Buy Rating)

1.c. Company Highlights

Last Price	22.3
Change Percentage	-0.49%
Open	22.15
Previous Close	22.41
Market Cap ( Millions)	8714
Volume	3316826
Year High	24.49
Year Low	16.83
M A 50	21.13
M A 200	21.38

FCF Yield	8.62%
Dividend Yield	2.51%
ROE	8.28%
Debt / Equity	81.43%
Net Debt / EBIDTA	746.19%
Price To Book	0.95
Price Earnings Ratio	13.06
Price To FCF	11.6
Price To sales	2.52
EV / EBITDA	17.83

2. Old National Bancorp's Q3 2025 Earnings: A Strong Performance

Old National Bancorp reported a robust third-quarter 2025 performance, with GAAP EPS of $0.46 and adjusted EPS of $0.59, marking an 11% increase over the prior quarter and a 28% increase year-over-year. The company's adjusted return on average tangible common equity stood at 20%, while the return on assets (ROA) was 1.3%. The efficiency ratio improved to sub-50%, driven by the full-quarter impact of Bremer operations, margin expansion, and better-than-expected growth in fee income. The actual EPS came in at $0.511, slightly below estimates of $0.56.

Publication Date: Oct -23

                                    📋 Highlights
                                    Strong Profitability Metrics::
                                                Adjusted ROATCE of 20%, ROA of 1.3%, and sub-50% efficiency ratio, reflecting top-decile performance.
EPS Growth Acceleration::
                                                Adjusted EPS rose 11% QoQ to $0.59 and 28% YoY, driven by Bremer integration, margin expansion, and fee income growth ($13M in Q3).
Capital Strengthening::
                                                CET1 ratio at 11% (up 28 bps QoQ), tangible book value up 4% QoQ, and $1.1M share repurchases amid improved capital ratios post-Bremer insurance sale.
Fee Income Volatility::
                                                $13M total fee income (Q3) includes non-sustainable capital markets gains; normalized annual guidance around $120M.
Loan Growth Guidance::
                                                3–5% Q4 loan growth (inclus. Bremer), offsetting $200M Q3 runoff, with stable NII and margin amid 40% legacy pipeline growth.

                                

Capital Position and Share Repurchase

The company's capital position has rebuilt quickly, with CET1 over 11%, 28 basis points higher linked quarter. Tangible book value per share grew 4% from Q2 and 10% over the last year. Old National repurchased 1,100,000 shares late in the quarter, demonstrating its focus on returning capital to shareholders. As Jim Ryan mentioned, there is a "healthy tension between looking at all constituencies" when it comes to returning capital.

Loan Growth and Net Interest Income

The company's loan growth guidance for the fourth quarter is 3-5%, inclusive of the Bremer acquisition. According to Tim, legacy year-over-year pipelines are up close to 40%, indicating a strong base for future growth. Net interest income is expected to be stable to improving in 2025, driven by loan growth and the Bremer partnership. John Moran stated that NII will grow, and margin will be stable or dependent on yield curve dynamics.

Valuation and Dividend Yield

With a Price-to-Tangible Book Value (P/TBV) ratio of approximately 0.89, Old National's valuation appears reasonable. The Dividend Yield stands at 2.69%, providing a relatively attractive return for income investors. Analysts estimate revenue growth at 14.5% next year, which, combined with the current valuation metrics, suggests that the stock may be poised for further upside.

Efficiency and Credit Environment

The company expects to realize significant Bremer-related efficiencies in the coming quarters, with over $115 million in annualized savings anticipated. The credit environment is described as stable to improving, with comfortable guidance and trends in the portfolio. Delinquencies have improved, and the company continues to monitor and scrub its portfolios to ensure nothing unusual.

3. NewsRoom

Old National Bancorp $ONB Shares Sold by Elizabeth Park Capital Advisors Ltd.

09:10

Source: defenseworld.net

American Resources secures $5M credit facility from Old National Bank

Dec -03

Source: proactiveinvestors.com

American Resources Corporation Secures $5 Million Credit Facility with Old National Bank to Procure Rare Earth and Critical Mineral Feedstocks

Dec -03

Source: accessnewswire.com

Old National Bancorp (NASDAQ:ONB) vs. First Business Financial Services (NASDAQ:FBIZ) Financial Review

Nov -27

Source: defenseworld.net

Old National Bank Celebrates Clients with Weeklong Appreciation Events and $10,000 Prize Drawing

Nov -18

Source: globenewswire.com

Contrasting Old National Bancorp (NASDAQ:ONB) & First Western Financial (NASDAQ:MYFW)

Nov -17

Source: defenseworld.net

Head-To-Head Review: Old National Bancorp (NASDAQ:ONB) & First Western Financial (NASDAQ:MYFW)

Nov -17

Source: defenseworld.net

Old National Bancorp (NASDAQ:ONB) Given Consensus Recommendation of “Moderate Buy” by Brokerages

Nov -15

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (16.10%)

6. Segments

Community Banking

Expected Growth: 15.5%

The community banking segment is expected to grow at a rate slightly lower than the global revenue growth hypothesis of 16.1% due to potential economic uncertainties and fluctuations in interest rates. However, the segment's diversified revenue streams, including interest income and fees, are expected to drive growth. Additionally, the segment's focus on traditional banking services will continue to attract customers seeking stable financial institutions.

7. Detailed Products

Consumer Banking

Personal banking services for individuals, including checking and savings accounts, credit cards, personal loans, and mortgages.

Commercial Banking

Financial solutions for businesses, including cash management, commercial lending, and treasury management services.

Wealth Management

Comprehensive investment and wealth management services, including investment advice, portfolio management, and trust services.

Mortgage Banking

Residential and commercial mortgage lending services, including purchase and refinance loans, construction loans, and home equity loans.

Treasury Management

Cash management and treasury services, including account management, payment processing, and fraud prevention.

Investment Services

Brokerage and investment services, including investment advice, retirement planning, and insurance services.

8. Old National Bancorp's Porter Forces

Forces Ranking

Threat Of Substitutes

Old National Bancorp operates in a highly competitive industry, and customers have various alternatives to choose from. However, the company's strong brand reputation and customer loyalty mitigate the threat of substitutes.

Bargaining Power Of Customers

Old National Bancorp's customers have limited bargaining power due to the company's diversified customer base and lack of concentration. The company's strong relationships with customers also reduce the bargaining power of individual customers.

Bargaining Power Of Suppliers

Old National Bancorp has a diversified supplier base, which reduces the bargaining power of individual suppliers. The company's strong financial position also gives it negotiating power in supplier relationships.

Threat Of New Entrants

The banking industry has high barriers to entry, including regulatory hurdles and capital requirements. This limits the threat of new entrants and allows Old National Bancorp to maintain its market position.

Intensity Of Rivalry

The banking industry is highly competitive, with many established players competing for market share. Old National Bancorp faces intense competition from larger banks and fintech companies, which increases the intensity of rivalry.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	48.94%
Debt Cost	8.07%
Equity Weight	51.06%
Equity Cost	8.07%
WACC	8.07%
Leverage	95.83%

11. Quality Control: Old National Bancorp passed 3 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

Texas Capital Bancshares

A-Score: 6.3/10

Value: 6.5

Growth: 5.3

Quality: 6.6

Yield: 5.0

Momentum: 5.0

Volatility: 9.7

1-Year Total Return ->

Citizens Business Bank

A-Score: 6.3/10

Value: 5.7

Growth: 5.0

Quality: 7.3

Yield: 8.0

Momentum: 4.5

Volatility: 7.3

1-Year Total Return ->

Old National

A-Score: 6.1/10

Value: 6.0

Growth: 5.4

Quality: 5.7

Yield: 6.0

Momentum: 7.0

Volatility: 6.7

1-Year Total Return ->

Huntington Bancshares

A-Score: 6.1/10

Value: 6.5

Growth: 4.8

Quality: 5.7

Yield: 8.0

Momentum: 5.0

Volatility: 6.7

1-Year Total Return ->

Pinnacle Financial Partners

A-Score: 5.5/10

Value: 6.8

Growth: 7.4

Quality: 7.1

Yield: 2.0

Momentum: 4.0

Volatility: 6.0

1-Year Total Return ->

United Community Banks

A-Score: 5.3/10

Value: 6.6

Growth: 5.0

Quality: 7.5

Yield: 5.0

Momentum: 5.0

Volatility: 3.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

2.36%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

8.07%

Old National Bancorp - US6800331075

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on ONB

1.c. Company Highlights

Stable Momentum

Average Quality

Average Yield

Earnings Beats

Revenues Beats

Fairly Valued

Medium Volatility

Revenues Miss

Better Quality

2. Old National Bancorp's Q3 2025 Earnings: A Strong Performance

Capital Position and Share Repurchase

Loan Growth and Net Interest Income

Valuation and Dividend Yield

Efficiency and Credit Environment

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (16.10%)

6. Segments

Community Banking

Expected Growth: 15.5%

7. Detailed Products

Consumer Banking

Commercial Banking

Wealth Management

Mortgage Banking

Treasury Management

Investment Services

8. Old National Bancorp'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: Old National Bancorp passed 3 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

22.3$

Current Price

22.3$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA