FS Bancorp (FSBW) has wrapped up FY 2025 with fourth quarter revenue of US$36.4 million and basic EPS of US$1.14, alongside trailing twelve month revenue of US$143.1 million and EPS of US$4.35 that reflect the broader earnings picture. Over the past year, the company has seen revenue move from US$139.2 million on a trailing basis in FY 2024 to US$143.1 million in FY 2025, while EPS shifted from US$4.48 to US$4.35, setting a mixed backdrop for the latest numbers. With a net profit margin of 23.3% for the year and a current share price of US$41.55, the focus now is on how these results shape the earnings story and what they signal about the durability of margins.

With the headline figures on the table, the next step is to see how these results line up with the widely held narratives about FS Bancorp, where some views may be reinforced and others put to the test.

Margins Hold With 4.33% Net Interest Spread

• Across the last twelve months, FS Bancorp reported a net interest margin of 4.33% and a cost to income ratio of 66.81%, with quarterly net interest margin hovering between 4.3% and 4.37% in FY 2025.
• What stands out for a bullish view is that this 4.33% net interest margin and 23.3% trailing net profit margin sit alongside a description of high quality past earnings, even though that margin is lower than the 24.8% reported a year earlier.
  • Supporters who focus on stability can point to the fairly tight range in quarterly net interest margin, from 4.3% in Q2 2025 to 4.37% in Q3 2025, as evidence that lending spreads have stayed relatively consistent.
  • At the same time, critics of the bullish angle may highlight that the move from a 24.8% to 23.3% net margin over the year and a five year earnings contraction of about 3.6% per year show that profitability has not been on a straight upward path.

To see how this margin profile fits into the longer term growth story and valuation debate, have a look at the full narrative on FS Bancorp. 📊 Read the full FS Bancorp Consensus Narrative.

Loan Book Near US$2.7b With Rising Non Performing Balances

• Total loans reached US$2,655.1 million at FY 2025 Q4 compared with US$2,533.8 million at FY 2024 Q4, while non performing loans moved from US$13.6 million to US$18.7 million over the same period.
• Bears argue that a cautious stance is justified when non performing loans rise in absolute terms, and they may focus on the increase from US$10.8 million in Q3 2024 to a range between US$18.4 million and US$19.0 million across FY 2025, especially when paired with a five year earnings decline of about 3.6% per year.
  • That pattern gives skeptics concrete credit quality data to point to, since the non performing loan balance is now around US$18.7 million compared with US$14.5 million at FY 2025 Q1 and US$13.6 million a year earlier.
  • At the same time, those same figures coexist with trailing twelve month net income of US$33.3 million, suggesting the bank remains profitable even as bears focus on the higher non performing loan level.

9.2x P/E And 2.79% Yield Against Slower Growth

• The shares trade on a trailing P/E of 9.2x versus US Banks at 12.1x and peers at 11.9x, with the stock price of US$41.55 quoted as around 51.3% below a DCF fair value of about US$85.35, while the dividend yield sits at 2.79%.
• Supporters of a bullish angle often point to this lower P/E, the gap to the US$85.35 DCF fair value and the 2.79% dividend yield as evidence of potential value, yet the same data set records revenue growth forecasts of about 6.7% per year and earnings growth forecasts of roughly 4.7% per year, both below broader US market rates.
  • That mix of a lower multiple and a reported DCF value roughly double the current US$41.55 price heavily supports the idea that the stock is priced more cautiously than the modelled cash flows suggest.
  • However, the fact that five year earnings declined at about 3.6% per year and net margin fell from 24.8% to 23.3% provides a clear counterpoint for investors who question whether the lower P/E and dividend fully balance the slower growth profile.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on FS Bancorp's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

FS Bancorp's earnings contraction over five years, softer net margin and rising non performing loans suggest that recent profitability and balance sheet quality face some pressure.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.