Value
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Fwd P/E | 9.4 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 9.0x
- ▸PEG: 0.05
- ▸Attractively valued
HBNC · Why this verdict
Why Horizon Bancorp (HBNC) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Quality sits below the engine's 4.0 floor at 2.8, driven by a lack of competitive moat and weak profitability metrics including a 0.0 return on equity and 0.0 net margin, triggering the quality-floor exit signal. Bear case | Return on equity and net margin should turn durably positive over the next 12 months if profitability genuinely improves. | →Stable |
| CounterA regional bank with near-zero net margin and ROE readings in a single period can reflect one-off provisioning or merger-related charges rather than a structurally impaired earnings base, especially alongside a perfect 4-quarter beat streak. | ||
The stock has already reached its analyst price target with modeled upside at -8.7%, per the engine's target check, limiting further re-rating room at current levels. Bear case | Modeled upside should recover above 10% over the next 12 months if the analyst target is raised or the stock consolidates lower. | →Stable |
| CounterA perfect 4-of-4 quarter earnings beat streak with another report due in 18 days could prompt analysts to raise price targets quickly, resolving the target-reached signal without requiring the stock to fall. | ||
The setup has failed the engine's asymmetry gate with a ratio of -1.18, reflecting a risk/reward skew where 7.4% modeled downside exceeds the 1.2% modeled upside. Engine gate (failed) | The asymmetry ratio should turn positive above 1.5 over the next 12 months if the price target is revised higher or the stock pulls back to a better entry. | →Stable |
| CounterThe stock is in a confirmed breakout with a golden cross and bullish MACD, and an upcoming earnings catalyst with a perfect beat history could push the price and price target higher together, quickly flipping the ratio positive. | ||
The engine flags a yield trap warning, indicating the stock's dividend yield may not be sustainably covered even alongside its perfect earnings beat streak. Catalyst breakdown | The dividend safety component should rise above 6.0 over the next 12 months if payout coverage improves. | →Stable |
| CounterA perfect 4-quarter earnings beat streak suggests earnings power is strong enough to comfortably support the current dividend, so the yield-trap flag may reflect a conservative scoring heuristic rather than a genuine payout risk. | ||
Insiders have shown only negligible net buying, a single purchase totaling $23,978 (0.002% of market cap), providing a bullish signal direction but too small to carry strong conviction. Insider breakdown | Insider buying should grow to a more materially sized purchase, exceeding 0.05% of market cap, over the next 12 months if insiders develop stronger conviction in the stock. | →Stable |
| CounterA single small purchase can still signal genuine insider confidence even at a modest dollar size, particularly for a regional bank where insider trades are often small relative to market cap by convention. | ||
Quality sits below the engine's 4.0 floor at 2.8, driven by a lack of competitive moat and weak profitability metrics including a 0.0 return on equity and 0.0 net margin, triggering the quality-floor exit signal.
→StableBear case
- Expectation
- Return on equity and net margin should turn durably positive over the next 12 months if profitability genuinely improves.
CounterA regional bank with near-zero net margin and ROE readings in a single period can reflect one-off provisioning or merger-related charges rather than a structurally impaired earnings base, especially alongside a perfect 4-quarter beat streak.
The stock has already reached its analyst price target with modeled upside at -8.7%, per the engine's target check, limiting further re-rating room at current levels.
→StableBear case
- Expectation
- Modeled upside should recover above 10% over the next 12 months if the analyst target is raised or the stock consolidates lower.
CounterA perfect 4-of-4 quarter earnings beat streak with another report due in 18 days could prompt analysts to raise price targets quickly, resolving the target-reached signal without requiring the stock to fall.
The setup has failed the engine's asymmetry gate with a ratio of -1.18, reflecting a risk/reward skew where 7.4% modeled downside exceeds the 1.2% modeled upside.
→StableEngine gate (failed)
- Expectation
- The asymmetry ratio should turn positive above 1.5 over the next 12 months if the price target is revised higher or the stock pulls back to a better entry.
CounterThe stock is in a confirmed breakout with a golden cross and bullish MACD, and an upcoming earnings catalyst with a perfect beat history could push the price and price target higher together, quickly flipping the ratio positive.
The engine flags a yield trap warning, indicating the stock's dividend yield may not be sustainably covered even alongside its perfect earnings beat streak.
→StableCatalyst breakdown
- Expectation
- The dividend safety component should rise above 6.0 over the next 12 months if payout coverage improves.
CounterA perfect 4-quarter earnings beat streak suggests earnings power is strong enough to comfortably support the current dividend, so the yield-trap flag may reflect a conservative scoring heuristic rather than a genuine payout risk.
Insiders have shown only negligible net buying, a single purchase totaling $23,978 (0.002% of market cap), providing a bullish signal direction but too small to carry strong conviction.
→StableInsider breakdown
- Expectation
- Insider buying should grow to a more materially sized purchase, exceeding 0.05% of market cap, over the next 12 months if insiders develop stronger conviction in the stock.
CounterA single small purchase can still signal genuine insider confidence even at a modest dollar size, particularly for a regional bank where insider trades are often small relative to market cap by convention.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Horizon Bancorp shows a perfect 4-quarter earnings beat streak and a confirmed technical breakout, but quality sits below the engine's floor on weak profitability metrics, the stock has already reached its analyst target, the asymmetry gate has failed, and a yield-trap warning reinforces caution - consistent with the recommendation to exit the position.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
2.8/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 0.0 |
| Op margin | 10.0 |
| Net margin | 0.0 |
| Moat | 4.1 |
| Piotroski F | 5.6 |
- ▸No competitive moat
- ▸Quality concerns
Growth
7.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.6 |
| EPS growth | 10.0 |
Momentum
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 2.7 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 0.9 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 6.3 |
| Price target | 6.5 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (4.0) — signal dampened
Insider
7.5/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
- ▸Negligible insider buying — $23,978 (0.002% of mkt cap)
- ▸Institutions accumulating
Peer rank
3.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.0 |
| quality rank | 0.0 |
| growth rank | 3.0 |
Technical
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 6.7 |
| support resistance | 6.0 |
| 52w position | 8.9 |
Risk (lower is worse)
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.5 |
| days to cover | 6.6 |
| volatility | 6.7 |
| implied vol | 0.5 |
| beta | 8.1 |
- ▸High IV: 77%
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.5 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 3.2%
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:15d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:3.2<4.5
- ASYMMETRY:-1.3=NEGATIVE
Warning (0)
none
Reward-to-Risk
-1.28
Upside
-6.4%
Downside
5.0%
Sizing output
AVOID
SetupRange Bound — RSI 50 mid-range, Bollinger mid-band
EdgeCatalyst-Driven — Earnings in 15d with 4/4 beat streak
SuitabilityAggressive — MCap $1.0B<$5B
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 7.8 could not lift the engine output above the verdict floor. Failed gate signal: MOMENTUM:3.2<4.5.
The strongest dimensions are Value at 7.8, Insider at 7.5, and Growth at 7.3; the weakest are Quality at 2.8, Momentum at 3.2, and Peer rank at 3.3. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -1.28 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality Below Floor No Moat
Trip ifReturn on equity and net margin both rise above 5.0 out of 10, from the current 0.0, for 2 consecutive quarters.
- P2Target Reached Limited Upside
Trip ifModeled upside rises above 10%, from the current -8.7%, as the analyst target is revised or the price pulls back.
- P3Negative Asymmetry Gate Failure
Trip ifAsymmetry ratio rises above 1.5, from the current -1.18, as the price target or downside estimate resets.
- P4Yield Trap Warning
Trip ifDividend safety component rises above 6.0, from the current 4.8, over the next 2 quarters.
- P5Negligible Insider Buying
Trip ifNet insider buying exceeds $250,000 over a 90-day window, from the current $23,978, or the signal flips to bearish with net insider selling.