FSBW Should I Buy
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FS Bancorp Inc (FSBW) is not a strong buy at the moment for a beginner investor with a long-term strategy. While the company has shown solid financial growth in Q4 2025 and has a positive catalyst in the form of a merger with Pacific West, the technical indicators are neutral, and there are no strong trading signals or significant insider/hedge fund activity to suggest immediate action. The stock's recent price movement and lack of clear upward momentum make it more suitable for holding rather than buying at this time.
The MACD is negative and contracting, indicating weak momentum. RSI is neutral at 41.211, and moving averages are converging, showing no clear trend. The stock is trading near its support level of 40.46, with resistance at 42.224.
The merger with Pacific West is expected to increase FS Bancorp's earnings per share by 7.4% immediately post-merger. The merger has unanimous board approval and is projected to close in Q3 2026, pending regulatory approval.
The merger will dilute tangible book value by 2.2% at closing. Analysts have lowered the price target to $45 from $47 due to Q4 earnings miss, despite strong revenue growth.
In Q4 2025, revenue increased by 9.02% YoY to $34.96 million, net income rose by 15.98% YoY to $8.42 million, and EPS grew by 23.08% YoY to 1.12. These figures indicate strong financial performance.
DA Davidson maintains a Neutral rating and has lowered the price target to $45 from $47, citing strong revenue growth but offsetting expenses and elevated charge-offs. The firm expects loan growth to accelerate and notes solid credit quality.
