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FS Bancorp (FSBW) Stock Up 3.6% on New Share Repurchase Plan

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Shares of FS Bancorp, Inc. (FSBW - Free Report) rallied 3.6% following the announcement of a new share repurchase plan last week. The board of directors has approved buyback authorization worth $5 million.

Repurchases under the program can be executed either through the open market or privately negotiated transactions, depending on the market conditions and other factors.

FS Bancorp has been rewarding shareholders through regular buybacks. Earlier in January, the bank had authorized 225,000 shares or 5% of issued shares and outstanding common stock (as of Dec 31, 2019) for repurchase, which was set to expire in January 2021. Nonetheless, as of Jun 30, 2020, the company fully utilized this buyback program.

Apart from share repurchase authorizations, FS Bancorp has been paying regular quarterly cash dividend. Since 2014, the company has been increasing its quarterly dividend on an annual basis. The last hike of 5% was announced in January. Considering last day’s closing price of $41.82, FS Bancorp’s dividend yield currently stands at 2.01%.

FS Bancorp’s financials are supported by strong balance sheet. As of Jun 30, the company had total debt worth $160.2 million, higher than the total cash and cash equivalents balance of $126.1 million. Yet, its total debt to total capital of 43.4% at the end of the second quarter improved sequentially. Also, the company’s times-interest-earned of 13.7 at the end of the June quarter improved from the prior quarter.

Given the earnings strength and decent liquidity position, the company will likely be able to sustain the current level of capital deployment program.

Shares of FS Bancorp have jumped 39.9% over the past six months, significantly outperforming the industry’s rally of 6.7%.



Currently, FS Bancorp sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

New Share Buyback Plans by Other Banks

Over the last few weeks, several banks including Home Bancorp, Inc. (HBCP - Free Report) , HarborOne Bancorp, Inc. (HONE - Free Report) and Columbia Financial, Inc.’s (CLBK - Free Report) have announced new share repurchase authorizations. Home Bancorp’s board of directors approved the repurchase of up to 444,000 shares of the company’s common stock.

HarborOne Bancorp’s board of directors adopted a share repurchase program, which authorized buyback of up to 2.92 million shares, while Columbia Financial announced authorization to repurchase up to about 5 million shares.

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