Did Home Federal Bancorp beat earnings in Q2 FY2026?

Home Federal Bancorp reported diluted EPS of $0.54 for Q2 FY2026, up 64% from $0.33 in Q2 FY2025. The company has minimal analyst coverage, so no consensus estimate was available for comparison.

What drove Home Federal Bancorp's earnings growth?

Earnings growth was driven by a 55 basis point improvement in net interest margin (3.67% vs 3.12% YoY), a 16.9% increase in net interest income, and a 30.7% increase in non-interest income, while non-interest expenses declined 1.1%.

What is Home Federal Bancorp's net interest margin?

HFBL's net interest margin was 3.67% for Q2 FY2026, up from 3.12% in Q2 FY2025, representing a 55 basis point improvement driven by lower deposit costs and higher loan yields.

Home Federal Bancorp, Inc. of Louisiana (HFBL)·Q2 2026 Earnings Summary

Home Federal Bancorp Posts 64% EPS Growth as NIM Expansion Continues

January 28, 2026 · by Fintool AI Agent

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Home Federal Bancorp, Inc. of Louisiana (NASDAQ: HFBL) reported strong Q2 FY2026 results, with diluted EPS of $0.54 compared to $0.33 in the prior year quarter—a 64% increase . The Louisiana-based community bank delivered net income of $1.675 million versus $1.020 million a year ago, driven primarily by net interest margin expansion and disciplined expense management .

Despite the strong results, shares fell 3.4% to $18.82 in post-earnings trading. With a market cap of approximately $58 million and minimal analyst coverage, HFBL trades as a thinly-followed micro-cap regional bank.

Did Home Federal Bancorp Beat Earnings?

No consensus estimate available. As a micro-cap regional bank with ~$620 million in assets, HFBL has minimal Wall Street coverage. However, the company delivered strong year-over-year improvement across key metrics:

Metric	Q2 FY2026	Q2 FY2025	YoY Change
Net Income	$1.68M	$1.02M	+64%
Diluted EPS	$0.54	$0.33	+64%
Net Interest Margin	3.67%	3.12%	+55 bps
Return on Equity	11.54%	7.76%	+378 bps
Return on Assets	1.07%	0.65%	+42 bps

For the six-month period ended December 31, 2025, HFBL reported net income of $3.274 million ($1.07 diluted EPS) compared to $1.961 million ($0.64 diluted EPS) in the prior year period—a 67% improvement .

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What Drove the Earnings Improvement?

The 64% earnings growth was driven by three primary factors:

1. Net Interest Margin Expansion (+55 bps)

Net interest margin expanded to 3.67% from 3.12%, driven by:

Higher loan yields: Average yield on loans increased to 6.20% from 5.89%
Lower deposit costs: Total interest-bearing deposit costs fell to 2.43% from 2.75%
Average interest rate spread improved to 3.03% from 2.40%

NIM Trend

Net interest income grew $777,000 or 16.9% to $5.377 million, as total interest income increased 5.3% while total interest expense declined 12.2% .

2. Non-Interest Income Growth (+30.7%)

Non-interest income increased $150,000 to $638,000, driven by:

Gain on sale of loans up $125,000
Service charges on deposit accounts up $44,000
Reduced losses on securities sales

3. Expense Discipline (-1.1%)

Non-interest expense declined $43,000 despite inflationary pressures:

Compensation and benefits down $128,000
Audit and examination fees down $81,000
Advertising expense down $20,000

What Changed From Last Quarter?

HFBL has now delivered four consecutive quarters of improving profitability:

Metric	Q3 FY25	Q4 FY25	Q1 FY26	Q2 FY26
Diluted EPS	$0.24	$0.38	$0.52	$0.54
Net Interest Margin	3.06%*	3.30%*	3.64%*	3.67%
Return on Equity	5.51%*	8.59%*	11.44%*	11.54%

*Values retrieved from S&P Global

The trend reflects consistent NIM expansion as deposit costs reprice lower while loan yields remain elevated.

Balance Sheet Highlights

Metric	Dec 31, 2025	Jun 30, 2025	Change
Total Assets	$621.4M	$609.5M	+2.0%
Net Loans	$471.5M	$461.0M	+2.3%
Total Deposits	$554.9M	$546.3M	+1.6%
Stockholders' Equity	$57.7M	$55.2M	+4.6%
Book Value/Share	$18.76	$17.90	+4.8%

Key strength: Zero wholesale funding dependency—no brokered deposits or FHLB advances at either period end . This positions the bank well in a higher-for-longer rate environment.

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Asset Quality Remains Solid

Non-performing assets declined to $2.533 million (0.41% of assets) from $3.305 million at June 30, 2025 . The allowance for credit losses covers 257.66% of non-performing loans .

The provision for credit losses was $109,000 for the quarter versus $45,000 in the prior year period , reflecting a modest increase in reserves as the loan portfolio grew.

How Did the Stock React?

Despite the strong quarter, HFBL shares fell 3.4% to $18.82 following the earnings release. This may reflect:

Thin trading volume (~4,000 shares daily)
Stock trading near 52-week highs ($20.00)
Price/book near 1.0x ($18.82 price vs $18.76 book value)

Stock Metric	Value
Current Price	$18.82
Change	-3.4%
52-Week Range	$12.31 - $20.00
Market Cap	~$58M
Price/Book	1.00x

The stock is up 29% over the past year, significantly outperforming the broader regional bank sector.

Capital Allocation

During the six months ended December 31, 2025, HFBL deployed capital through:

Stock repurchases: $2.270 million
Dividends paid: $833,000
Stock option exercises: $1.589 million in proceeds

What to Watch Going Forward

Deposit cost trajectory: With CDs repricing, continued NIM expansion depends on competitive deposit pricing in Louisiana markets
Loan growth sustainability: Net loans grew 2.3% in H1 FY26; management's ability to maintain growth will drive earnings
Credit quality: NPAs improved but warrant monitoring as Louisiana economic conditions evolve
Rate environment: Zero wholesale funding positions HFBL well, but prolonged higher rates could pressure borrower credit quality

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Company Overview

Home Federal Bancorp, Inc. of Louisiana is the holding company for Home Federal Bank, which operates ten full-service banking offices and a home office in northwest Louisiana . The bank focuses on traditional community banking with a conservative funding model.

For more details, view the Q2 FY2026 8-K filing or explore HFBL company research.