Westamerica Bancorporation Common Stock (WABC)

FairStock Score: 44/100 — MIXED

Key Financials

Strengths

• Solid return on equity of 12.5% above cost of capital
• Healthy net profit margin of 10.8% showing consistent profitability
• Attractive 3.4% dividend yield providing steady income returns

Concerns

• Revenue declining at 9.0% year-over-year signals potential demand weakness or market share loss
• Altman Z-Score of 0.3 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Westamerica Bancorporation Common Stock is a micro-cap financial services company valued at $1.3 billion. The business generates $254 million in annual revenue with a 10.8% net margin. From a quality standpoint, Westamerica shows distressed Altman Z-Score of 0.3 warrants caution and adequate 12% ROE. On valuation, the stock is attractively valued at 12.0x earnings, with a modest 12% margin of safety vs Graham Number. Growth dynamics show revenue growing at -9.0% and profit growth of -12.3%. The 3.4% dividend yield adds an income component for patient holders. Our composite FairStock Score of 44/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

The market underappreciates Westamerica's consistent 12% ROE at just 12x earnings—a re-rating toward sector peers could unlock 30-50% upside. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the financial services space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer