FB Financial (FBK) Issues New Notes, Where Does Fair Value Sit?

FB Financial’s new subordinated notes set the backdrop

FB Financial (FBK) just raised $125 million through 6.625% fixed to floating subordinated notes due 2036, giving investors fresh information on its funding mix and longer term capital structure.

Recent trading shows a mixed picture for FB Financial, with the share price up 2.55% on the day but down 5.05% over 30 days and 4.81% year to date. The 3 year total shareholder return of 92.32% signals longer term momentum that contrasts with the softer near term moves around the subordinated notes issuance.

Spot 31 resilient stocks with low risk scores to compare FB Financial’s fresh subordinated notes move with other banks that pair disciplined funding structures with resilient balance sheets.

FB Financial now trades well below both analyst targets and intrinsic value estimates. After the subordinated notes move, where does a fair price really land within that spread?

Most Popular Narrative: 17% Undervalued

FB Financial’s most followed narrative pins fair value at $64.43 per share against the last close of $53.42, so the new subordinated notes now sit against a story that already assumes meaningful upside in the modeled cash flows.

The planned combination with Southern States Bank is expected to enhance scale and market opportunities, potentially benefiting revenue growth through expanded market presence and improved margin stabilization. FB Financial's ability to adjust cost structures, such as repricing certificates of deposit at lower rates, indicates management's focus on improving net margins by reducing the cost of funds.

See why 5 investors see FB Financial as 17% undervalued.

Using a 7.11% discount rate, that narrative links a fair value of $64.43 to assumptions about faster growth, wider margins, and disciplined capital use, including buybacks and potential deals alongside the new $125 million subordinated notes. The gap between the modeled value and the current $53.42 price reflects those embedded expectations rather than any short term trading reaction to the latest funding decision.

Result: Fair Value of $64.43 (UNDERVALUED)

Still, FB Financial’s story could change quickly if the integration of Southern States Bank drags on earnings or if credit costs in the C&I book climb again.

Find out about the key risks to this FB Financial narrative.

Another way to look at FB Financial’s valuation

There is a twist. FB Financial screens as undervalued on modeled cash flows, yet on earnings it does not look outright cheap. The current P/E sits at 13.6x, above the US Banks industry on 11.5x and also above the fair ratio of 12.8x that the market could move toward over time.

A higher P/E than both peers and the fair ratio points to less of a clear-cut bargain and more of a debate about how much you want to pay for recent earnings momentum versus the risk that multiples compress if expectations cool.

See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

Plenty in this FB Financial story points in different directions, so move quickly to review the full picture and weigh 4 key rewards and 1 important warning sign

Looking for more FB Financial style ideas?

If FB Financial’s setup has you thinking about what else might be worth your time, do not stop here. Use the screener tools to surface more focused ideas.

• Target dependable cash generators by scanning for companies with strong income potential using the 7 dividend fortresses.
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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.

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