Value
7.9/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.5 |
| P/S | 7.5 |
| Fwd P/E | 9.5 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 8.8x
- ▸PEG: 0.08
- ▸Attractively valued
AROW · Why this verdict
Why Arrow Financial (AROW) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score5.7/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Arrow Financial is a cheaply valued regional bank with strong margins and positive momentum, but its price already sits above the analyst target and earnings are due in five days after a recent miss. It is a hold rather than an add.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Profitability is strong, with margins of 30% and a Piotroski F-Score of 8 out of 9, though the business has no competitive moat. Quality breakdown | Margins should hold near 30% and the Piotroski score should stay at 7 or higher over 12 months. | →Stable |
| CounterWithout a moat, bank margins are exposed to deposit-cost and rate pressure, and ROA scores only 0.8. | ||
The stock is attractively valued, with a forward P/E of 8.9x and a PEG of 0.08. Valuation breakdown | Forward P/E should stay under about 12x while earnings grow, so the discount reflects the business rather than a falling outlook. | →Stable |
| CounterA PEG of 0.08 depends on earnings growth that scores only 2.3, so the cheapness may be a trap if earnings do not recover. | ||
The $38.37 price is 3.6% above the $36.98 analyst target, so there is no analyst-defined upside and 7.1% downside to the stop. Upside pct | Analysts should raise targets above the current price if earnings hold, restoring upside over 12 months. | →Stable |
| CounterWith momentum strong and the stock above all moving averages, price can keep running above a target that may be stale. | ||
Earnings show three beats in the last four quarters, but the latest quarter missed by 16.47% (EPS of $0.71 versus $0.85 expected), with the next report in 5 days. Bull case | EPS should meet or beat estimates in the next two quarters, returning to the earlier beat pattern. | →Stable |
| CounterThe July 2026 miss follows a longer history of misses in 2024 and 2025, so the beat streak may not be durable. | ||
Momentum is strong at 7.4 out of 10, with the price above its 200-day average, a bullish MACD and rising volume accumulation. Momentum breakdown | Momentum score should stay above 6.0 as the stock holds above its 200-day average. | ↑Improving |
| CounterThe Bollinger component scores 0.0 and the price already sits above the analyst target, so a pullback after the earnings report is plausible. | ||
Profitability is strong, with margins of 30% and a Piotroski F-Score of 8 out of 9, though the business has no competitive moat.
→StableQuality breakdown
- Expectation
- Margins should hold near 30% and the Piotroski score should stay at 7 or higher over 12 months.
CounterWithout a moat, bank margins are exposed to deposit-cost and rate pressure, and ROA scores only 0.8.
The stock is attractively valued, with a forward P/E of 8.9x and a PEG of 0.08.
→StableValuation breakdown
- Expectation
- Forward P/E should stay under about 12x while earnings grow, so the discount reflects the business rather than a falling outlook.
CounterA PEG of 0.08 depends on earnings growth that scores only 2.3, so the cheapness may be a trap if earnings do not recover.
The $38.37 price is 3.6% above the $36.98 analyst target, so there is no analyst-defined upside and 7.1% downside to the stop.
→StableUpside pct
- Expectation
- Analysts should raise targets above the current price if earnings hold, restoring upside over 12 months.
CounterWith momentum strong and the stock above all moving averages, price can keep running above a target that may be stale.
Earnings show three beats in the last four quarters, but the latest quarter missed by 16.47% (EPS of $0.71 versus $0.85 expected), with the next report in 5 days.
→StableBull case
- Expectation
- EPS should meet or beat estimates in the next two quarters, returning to the earlier beat pattern.
CounterThe July 2026 miss follows a longer history of misses in 2024 and 2025, so the beat streak may not be durable.
Momentum is strong at 7.4 out of 10, with the price above its 200-day average, a bullish MACD and rising volume accumulation.
↑ImprovingMomentum breakdown
- Expectation
- Momentum score should stay above 6.0 as the stock holds above its 200-day average.
CounterThe Bollinger component scores 0.0 and the price already sits above the analyst target, so a pullback after the earnings report is plausible.
Per-dimension breakdown
Quality
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.0 |
| ROA | 0.8 |
| Gross margin | 0.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Moat | 4.2 |
| Piotroski F | 8.9 |
- ▸Strong margins: 30%
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 8/9
Growth
3.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.7 |
| EPS growth | 2.3 |
Momentum
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 6.1 |
| MA position | 9.0 |
| Volume | 3.1 |
- ▸Above 200-day MA
Sentiment
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.0 |
| Analyst rating | 5.0 |
| Price target | 7.0 |
- ▸LLM news sentiment: +0.40 (n=1)
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
4.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.6 |
| quality rank | 5.1 |
| growth rank | 2.5 |
Technical
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.4 |
| support resistance | 3.0 |
| 52w position | 8.0 |
Risk (lower is worse)
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.3 |
| days to cover | 2.4 |
| volatility | 6.8 |
| implied vol | 6.2 |
| beta | 8.6 |
Catalyst
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| surprise avg | 1.4 |
| dividend safety | 5.5 |
| news activity | 5.0 |
- ▸Dividend: 3.2%
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLD|L3:NEWS_MOD_NO_UPSIDEPassed (6)
- MOMENTUM:6.7>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.5=NEGATIVE
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-0.45
Upside
-2.8%
Downside
6.2%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 60, MACD bullish
EdgeInst Constrain — Small cap ($0.7B) below institutional reach
SuitabilityAggressive — MCap $0.7B<$5B
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:6.7>=5.5. Top dim: Value at 7.9; weakest: Growth at 3.0. No conviction either direction.
The strongest dimensions are Value at 7.9, Insider at 7.3, and Momentum at 6.7; the weakest are Growth at 3.0, Peer rank at 4.0, and Catalyst at 4.5. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -0.45 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Attractive Bank Valuation
Trip ifForward P/E rises above 15x from current 8.9x.
- P2Price Above Analyst Target
Trip ifAnalyst target rises above $42 from current $36.98.
- P3Earnings Beat Record With Recent Miss
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P4Strong Margins No Moat
Trip ifProfit margin falls below 20% from current 30%.
- P5Positive Price Momentum
Trip ifMomentum score falls below 5.0 from current 7.4.