Earnings quality appears inconsistent, as demonstrated by erratic OCF/NI ratios that ranged from -1.92 to 4.42 over the last ten quarters, complicating the assessment of core cash-generating capacity.
| Cash from Operations | 16.43M | 11.9M | 5.55M | 21.91M | 24.31M | 18.18M | 17.51M | 16.75M | 9.48M | 8.61M | 6.82M | 7.65M | 2.5M |
| Operating CF Growth % | 197.25% | 114.27% | -74.65% | -9.9% | 33.73% | 3.84% | 4.5% | 76.8% | 10.08% | 26.24% | -10.84% | 205.31% | - |
| Net Income | 12.55M | 7.27M | 10.95M | -21.47M | 16.14M | 11.98M | 10.81M | 9.32M | 7.92M | 6.34M | 3.82M | 4.56M | 4.01M |
| Depreciation & Amortization | 885K | 1.07M | 1.09M | 1.1M | 1.03M | 1.09M | 1.39M | 914K | 811K | 832K | 713K | 767K | 646K |
| Deferred Taxes | 2.95M | 691K | 1.87M | -5.98M | -578K | -2.2M | -1.05M | -1.24M | 1.31M | -394K | -966K | -893K | 664K |
| Other Non-Cash Items | -4.49M | -273K | -1.9M | 55.22M | 2.77M | 4.97M | 4.52M | 3.61M | -2.24M | 922K | 3.25M | 1.94M | 326K |
| Working Capital Changes | 2.07M | 1.02M | -8.56M | -10.12M | 995K | 405K | -237K | 2.61M | 245K | 437K | -298K | 1.27M | -3.14M |
| Cash from Investing | 147.06M | 19.38M | 104.73M | -22.34M | -155.72M | -360.45M | -116.63M | -94.83M | -70.96M | -61.55M | -74.96M | -39.9M | -58.98M |
| Purchase of Investments | 0 | 0 | -1.82M | 0 | -13.63M | 0 | -13.73M | 0 | -13.12M | -9.84M | -17.84M | -13.46M | -25.23M |
| Sale/Maturity of Investments | 2.73M | 2.59M | 2.61M | 4.34M | 8.28M | 10.11M | 24.19M | 8.63M | 71.28M | 18.89M | 12.1M | 28.35M | 38.13M |
| Net Investment Activity | 2.73M | 2.59M | 790K | 4.34M | -5.35M | 10.11M | 10.46M | 8.63M | 58.16M | 9.05M | -5.74M | 14.88M | 12.9M |
| Acquisitions | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Investing | 144.75M | 17.16M | 104.28M | -26.42M | -149.96M | -369.66M | -120.85M | -101.07M | -125.69M | -69.73M | -67.41M | -54.21M | -71.35M |
| Cash from Financing | -173.28M | -82.47M | 29.42M | -72.05M | 200.7M | 366.43M | 130.17M | 59.01M | 98.46M | 43.18M | 79.05M | 26.46M | 48.48M |
| Dividends Paid | 0 | 0 | 0 | -1.99M | -2.56M | -1.64M | 0 | 0 | 0 | 0 | -167K | -172K | -172K |
| Share Repurchases | 17K | -56K | -74K | -2.97M | -18.96M | -7.96M | -193K | -215K | -594K | 0 | 0 | 0 | 0 |
| Stock Issued | 0 | 0 | 0 | 0 | 0 | 0 | 91.58M | 0 | 0 | 0 | 41.2M | 0 | 0 |
| Net Stock Activity | 17K | -56K | -74K | -2.97M | -18.96M | -7.96M | 91.39M | -215K | -594K | 0 | 41.2M | 0 | 0 |
| Debt Issuance (Net) | -2M | -1000K | -1000K | 1000K | 0 | -1000K | -1000K | 1000K | -1000K | -1000K | 1000K | -1000K | -1000K |
| Other Financing | -56.16M | -22.27M | 51.63M | -180.42M | 222.23M | 387.52M | 81.81M | 18.04M | 122.08M | 50.75M | 36.98M | 28.38M | 57.13M |
| Net Change in Cash | -9.78M | -51.19M | 139.7M | -72.49M | 69.3M | 24.16M | 31.05M | -19.08M | 36.98M | -9.76M | 10.91M | -5.8M | -7.99M |
| Exchange Rate Effect | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash at Beginning | 128.91M | 220.33M | 80.63M | 153.12M | 83.82M | 59.66M | 28.61M | 47.69M | 10.71M | 20.46M | 9.56M | 15.36M | 23.35M |
| Cash at End | 128.88M | 169.14M | 220.33M | 80.63M | 153.12M | 83.82M | 59.66M | 28.61M | 47.69M | 10.71M | 20.46M | 9.56M | 15.36M |
| Interest Paid | 33.09M | 39.12M | 31.99M | 4.28M | 3.08M | 5.93M | 8.15M | 5.33M | 3.73M | 2.78M | 2.16M | 2.34M | 2.59M |
| Income Taxes Paid | -15K | 334K | 163K | 5.16M | 8.38M | 6.26M | 5.01M | 3.64M | 6.67M | 3.08M | 2.18M | 1.55M | 1.28M |
| Free Cash Flow | 16.01M | 11.53M | 5.21M | 21.64M | 23.9M | 17.27M | 11.26M | 14.36M | 6.05M | 7.74M | 5M | 7.07M | 1.97M |
| FCF Growth % | 31.57% | 121.1% | -75.91% | -9.45% | 38.4% | 53.33% | -21.54% | 137.27% | -21.78% | 54.7% | -29.3% | 259.17% | - |
Niche asset concentration volatility
According to historical financial data, Provident Bancorp's net income has remained inconsistent, with quarterly earnings fluctuating between a $3.3 million loss and a $5.0 million profit, which complicates the bank's ability to build a reliable organic capital buffer to support its specialized lending initiatives.
The volatility in net income suggests that the bank's capital generation is highly sensitive to credit provisioning cycles rather than steady-state operational growth. Investors should monitor whether the current earnings trajectory provides sufficient retained earnings to support regulatory capital requirements without necessitating external financing or dilutive measures.
As reported in recent cash flow statements, Provident Bancorp has consistently recorded minimal investment purchases while maintaining steady asset sales, with proceeds averaging approximately $500,000 to $700,000 per quarter, suggesting a defensive posture that prioritizes liquidity over active duration management in the current interest rate environment.
The lack of significant investment purchases indicates that the bank may be hesitant to lock in long-term yields, potentially reflecting concerns regarding interest rate volatility or a desire to preserve cash for loan originations. This strategy appears to limit the potential for interest income growth from the securities portfolio, keeping the bank reliant on its core lending segments.
Based on reported figures, the bank's provision for credit losses has exhibited extreme swings, including a notable $6.5 million charge in 2024Q2, which highlights the inherent risk of the bank's specialized collateral and the potential for lumpy credit quality deterioration within its niche lending segments.
The erratic nature of these provisions suggests that the bank's cash flow is frequently impacted by management's periodic reassessment of credit risk, which may mask the underlying stability of core operations. Analysts should investigate whether these swings are indicative of structural weaknesses in the digital asset and commercial real estate portfolios.
As indicated by the erratic OCF/NI ratios, which ranged from -1.92 to 4.42 over the last ten quarters, the bank's cash flow statement appears to be heavily distorted by non-operating items and timing differences that obscure the true cash-generating capacity of the core banking business.
The extreme variance in operating cash flow relative to net income warrants further investigation into the bank's working capital management and the impact of non-cash adjustments. This lack of correlation suggests that reported cash flows may not be a reliable indicator of the bank's ability to fund future growth or sustain capital returns.
Quick answers to the most common questions about buying PVBC stock.
Provident Bancorp, Inc. (PVBC) generated $11.9M in net cash from operating activities in 2024. This reflects the cash generated directly from core business operations.
Provident Bancorp, Inc. (PVBC) generated $11.5M in free cash flow in 2024. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Provident Bancorp, Inc. (PVBC) spent $0.4M on capital expenditures in 2024. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2024, Provident Bancorp, Inc. (PVBC) spent $0.1M on share repurchases. This shows the company's commitment to returning capital to its equity investors.