Yuanxi Zhang
Long/short equity, value, special situations

Franklin Financial Services Corporation: A Likely Acquisition Target In Pennsylvania

Recommendation: Long Franklin Financial Services Corporation (OTC: FRAF) at $25.25

Target Price: $40.56 (61% upside)

Selected Financial Data

Current share price / Market Cap / TSO: $25.25 / $106.55MM / 4.22MM

Dividend yield / ROE / ROA: 2.7% / 8.9% / 0.84% Tangible book value: $22.34

Price / TBV: 1.11x 2014 P/E: 12.68x Insider ownership: 3.87% LQ / LTM EPS growth +62% / +34%

Share Price (1-year and 5-year)


Franklin Financial Services Corporation (OTCQX:FRAF) is an undervalued bank in Pennsylvania. Potential acquirers could be attracted to FRAF's low-cost deposit base as well as its leading market share in high-income markets. At least two banks would be interested in...

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