EQUITY BANCSHARES INC (EQBK) stock intrinsic value fair value estimate & owner earnings analysis

Equity Bancshares is a Wichita, Kansas-based community bank holding company (Equity Bank) with about 77 branches at the end of 2025, lending to and taking deposits from businesses and families in Kansas, Missouri, Oklahoma and Arkansas. It has grown mostly by buying smaller community banks: Bank of Kirksville in Missouri (February 2024), KansasLand Bank in western Kansas (July 2024), NBC Corp. of Oklahoma with seven branches in Oklahoma City, Altus, Kingfisher and Enid (July 2025, adding about $806 million of deposits), and Frontier Holdings, a roughly $1.4 billion-asset bank that earned about $17 million before tax in 2025 (closed January 1, 2026, systems converted in February 2026). Total assets went from $5.33 billion at the end of 2024 to $7.73 billion at June 30, 2026, while diluted shares rose from about 15.7 million to about 20.8 million, so each share now stands on about $371 of bank assets versus about $340 two years ago. How we measure earnings. We use the cash a shareholder could take out each year: cash from operations, less short-term timing swings in the balance sheet, stock-based pay, and the branch and systems spending needed to stand still. For a bank, deposits and borrowings are the raw material of the business, so interest paid to depositors and lenders is treated as an operating cost and our figure is already after all of it. Large one-off securities losses in 2023 ($52 million) and 2025 ($53 million), taken when the bank sold older low-yielding bonds to reinvest at higher yields, are non-cash accounting losses that do not reduce this figure; the higher yield they bought is what those sales were for. On this basis the bank earned $4.49, $3.81, $3.43, $3.12 and $3.31 per share in 2021 through 2025. Why our starting level is higher than last time. Our previous estimate started from the pre-merger median of $3.43 per share. That series describes a smaller bank. Since NBC and Frontier closed, the first two quarters of 2026 have both shown a larger earnings base: excluding $5.9 million of merger costs and an elevated first-quarter loan-loss provision in the quarter Frontier's loans came on board, first-half 2026 pre-tax, pre-provision earnings were about $69 million, which with normal loan-loss costs is roughly $4.80 of earnings per share a year (reported earnings were $2.06 for the half, $1.27 in the second quarter alone versus $0.86 a year earlier). We do not adopt that run-rate for the base case, because part of it is purchase-accounting accretion on acquired loans that fades and a second quarter with unusually low credit costs. Instead the base level is set at $4.00 per share: the bank's median five-year return on assets on our cash measure (about 1.08%) applied to today's $371 of assets per share. Growth check: our cash earnings per share grew about 6% in 2025; the base case steps up about 21% in the first year, and the dated reason is that NBC contributed only half of 2025 and Frontier none of it, both deals are closed, and the 2026 quarters already show the larger base. What we credit and what we do not. We credit no growth beyond that step-up in the base case. The bank grows mainly by acquisitions paid for largely in new shares and each deal is a sizeable bet (Frontier added about a fifth to the balance sheet), which is not the steady, self-funded, small-step growth we can count on; and organic loan growth between deals has been modest. A bank that does not grow can pay out essentially all of its earnings without weakening its capital, so a flat level is internally consistent. What keeps the earnings going beyond ten years is the deposit franchise itself: roughly $6.3 billion of deposits gathered over two decades across four states, which the bank has held through the 2019 credit problems, the 2020 pandemic (when it wrote off $105 million of goodwill from earlier acquisitions but kept generating cash) and the 2023 regional-bank deposit scare. Base case, about $66.67 per share: $4.00 per share every year, continuing as long as the franchise does. Because interest is already paid out of this figure, this value is what the owners' stake is worth after depositors and lenders; nothing further is subtracted. Bear case, about $55.00 per share: the merger benefits disappoint and profitability falls back to the weakest year of the last five (2024, about 0.95% of assets), or about $3.50 per share, after a first year of about $3.80. On top of that, a three-year credit downturn from year three with losses like 2020 (when the bank's loss provision reached about 0.9% of loans against a normal 0.1-0.2%) costs about $1.52 per share a year after tax, leaving $1.98 per share in those years. The evidence for this risk is in the filings: nonperforming assets rose from 0.53% of assets at the end of 2023 to 0.65% in 2024 and 0.73% in 2025, the 2025 loss provision was about $9 million against $2.5 million in 2024, and two newly acquired loan books are still being absorbed. Even in the downturn years earnings remain positive and comfortably cover the holding company's interest on its $98 million of subordinated notes (7.00% notes due 2030 and 7.125% notes due 2035), so the case does not require any lender forbearance. Bull case, about $84.72 per share: the first-half 2026 earning power of about $4.70 per share on our cash measure holds, and the bank's own disclosed lever of slower-repricing fixed-rate assets (about 38% of loans and nearly all securities are fixed-rate) continues to roll into higher yields for three more years, lifting earnings about 3% a year to about $5.13 and holding there. No further acquisitions, rate changes or market recovery are assumed. Debt. This is a bank, so we do not value it before interest and then subtract borrowings as we would for an industrial company; its deposits, $386 million of Federal Home Loan Bank advances and subordinated notes are all funding for the loan book, and their interest is already charged in every year of every case. In each case the figure above is therefore the business value net of what it owes. Leverage shows up where it belongs, in the size of the credit losses in the bear case. Our previous analysis handled debt the same way; the change in value comes from removing long-run growth we could not tie to a named, evidenced driver (our earlier base case assumed mid-single-digit growth tapering to about 2% a year forever) partly offset by the higher starting level from the completed mergers. What would make this wrong. Upside: if the 2026 run-rate proves durable after acquisition accretion fades, the base is too low. Downside: a sharper credit cycle in commercial real estate or agriculture across the Plains states, or a future acquisition that dilutes shareholders, would push value toward or below the bear case. The size of purchase-accounting accretion inside 2026 interest income could not be measured from the filings available to us, which is why the base case sits below the recent run-rate.