Sign in

You're signed outSign in or to get full access.

CF

CITIZENS FINANCIAL SERVICES (CZFS)·Q4 2025 Earnings Summary

Citizens Financial Services Crushes Q4 as NIM Expansion Drives 31% Earnings Growth

January 29, 2026 · by Fintool AI Agent

Banner

Citizens Financial Services, Inc. (NASDAQ: CZFS) delivered a standout Q4 2025, posting diluted EPS of $2.18—23.9% above the $1.76 consensus estimate. Net income surged 31.3% year-over-year to $10.5 million as the Pennsylvania-based community bank benefited from significant net interest margin expansion and disciplined expense management.

The stock rose 2.6% on the news, closing at $61.83.

Did CZFS Beat Earnings?

Yes—decisively. This marks four consecutive quarters of EPS beats for Citizens Financial Services.

MetricQ4 2025Q4 2024YoY Change
Diluted EPS$2.18 $1.66 +31.3%
Net Income$10.5M $8.0M +31.3%
ROE (Annualized)12.53% 10.63% +190 bps
ROA (Annualized)1.37% 1.06% +31 bps

The beat was driven primarily by net interest income expansion. Net interest income before provision rose 14.6% YoY to $26.2 million as the tax-equivalent net interest margin expanded 43 basis points to 3.69%.

FintoolAsk Fintool AI Agent

What Drove the Margin Expansion?

The net interest margin story is the headline. CZFS achieved a 3.69% NIM in Q4 2025, up from 3.26% a year ago—a 43 basis point improvement.

NIM Trend

Key drivers:

  • Yield on earning assets up 12 bps to 5.77%, as higher-yielding securities replaced maturities
  • Cost of interest-bearing liabilities down 35 bps to 2.59%, benefiting from rate cuts and deposit repricing
  • Investment portfolio yield improved from 2.44% to 3.06% (tax-equivalent basis) as new purchases were made at higher rates

The net interest spread widened to 3.18%, up from 2.71% in Q4 2024.

How Did the Stock React?

CZFS shares rose +2.6% on January 29, closing at $61.83—near the session high.

Price MetricValue
Close (1/29/26)$61.83
Prior Close$60.24
52-Week High$69.30
52-Week Low$49.99
Market Cap~$297M

The stock trades at 0.88x tangible book value ($52.02 TBV/share) and 8.1x trailing twelve-month earnings ($7.62 FY2025 EPS).

What Changed From Last Quarter?

Compared to Q3 2025:

MetricQ4 2025Q3 2025Change
Net Income$10.5M $10.0M +4.8%
EPS$2.19 $2.09 +4.8%
NIM3.69% 3.55%+14 bps
Provision$500K $500K Flat

Notable developments in Q4:

  • Two commercial loans placed on non-accrual in the fourth quarter, driving a $500K provision for specific reserves. However, the bank also recognized $878K in interest income recovery from two previously non-accrual relationships that paid off.
  • Non-performing assets rose slightly to $29.2M from $23.0M at Q3 but remain at 1.24% of total loans—unchanged from year-end 2024.
  • Expenses declined 3.0% QoQ to $16.2M on lower headcount (down 11 FTEs) and reduced salary/benefit costs.

Full Year 2025 Summary

For the full year, CZFS delivered strong performance:

MetricFY 2025FY 2024YoY Change
Net Income$36.6M $27.8M +31.5%
EPS (Diluted)$7.62 $5.79 +31.6%
ROE11.51% 9.59% +192 bps
ROA1.21% 0.93% +28 bps
NIM3.50% 3.13% +37 bps
Net Interest Income$98.0M $86.5M +13.4%

The 2024 results included a one-time gain from the sale of the Braavo division ($1.1M) and elevated credit provisions related to retained Braavo loans ($1.8M). Excluding these items, adjusted EPS for 2024 was $5.95, making the 2025 growth rate even more impressive.

FintoolAsk Fintool AI Agent

Balance Sheet Highlights

MetricDec 31, 2025Dec 31, 2024Change
Total Assets$3.06B $3.03B +1.3%
Net Loans$2.33B $2.29B +1.6%
Deposits$2.38B $2.38B -0.2%
Stockholders' Equity$338.1M $299.7M +12.8%
Book Value/Share$70.32 $62.35 +12.8%
Tangible BV/Share$52.02 $43.91 +18.5%

Loan mix shifts:

  • Commercial real estate loans grew $97M (+8.7%) to $1.22B
  • Construction loans declined $70M (-43%) as projects completed and paid off
  • The loan-to-deposit ratio increased to 98.9% from 97.1%

Credit Quality

Credit metrics remain stable despite the quarterly noise from specific reserves:

MetricQ4 2025Q4 2024
Non-Performing Assets$29.2M $28.6M
NPAs / Total Loans1.24% 1.24%
ACL / Total Loans0.97% 0.94%
Net Charge-Offs (Ann.)0.01% 0.01%

The allowance for credit losses increased $1.1M during 2025 to $22.8M. Net charge-offs were minimal at $0.8M for the full year vs. $2.6M in 2024 (which included Braavo-related losses).

Capital Return

CZFS continues its shareholder-friendly capital allocation:

  • Quarterly dividend raised 3.1% to $0.50/share (adjusted for 1% stock dividend in June 2025)
  • Full-year dividends paid: $1.98/share
  • Dividend yield: ~3.2% at current price
  • Payout ratio: ~26% of earnings

The bank declared a 1% stock dividend in June 2025.

Forward Outlook

Management did not provide specific forward guidance, but the setup appears favorable:

Positives:

  • NIM expansion momentum should continue as higher-rate investments roll on and deposits reprice lower
  • Expense discipline with headcount down 12 FTEs YoY
  • Strong capital position (12.8% equity growth) supports continued dividend increases

Watch Items:

  • Construction loan paydowns reducing earning assets
  • Deposit competition remains intense—brokered CDs down $33M, but core deposit costs still elevated
  • Two new non-accrual loans in Q4 bear monitoring
FintoolAsk Fintool AI Agent

Key Takeaways

  1. Strong beat: EPS of $2.18 exceeded consensus by 24%, marking four straight quarters of outperformance
  2. Margin expansion: NIM improved 43bps YoY to 3.69% as deposit costs fell faster than asset yields
  3. Credit stable: NPAs flat at 1.24% of loans despite quarterly noise from specific reserves
  4. Capital returned: Dividend raised 3.1%; stock up 2.6% on earnings
  5. Valuation: At 0.88x TBV and 8x earnings, CZFS screens cheap for a bank delivering 11.5%+ ROE

Citizens Financial Services is the parent company of First Citizens Community Bank, a Pennsylvania-chartered community bank with $3.1 billion in assets and approximately 1,800 shareholders.

Related Links: