SEACOAST BANKING CORP OF FLORIDA (SBCF) stock intrinsic value fair value estimate & owner earnings analysis

Seacoast is a $21 billion Florida bank holding company with 104 branches, about $16.8 billion of deposits and $13.1 billion of loans. It earns the spread between what it pays on deposits and what it earns on loans (about 85% of revenue), plus fees from mortgage banking, wealth management, insurance and service charges. Its growth history is acquisition-heavy: Professional Holding (2023), Heartland (July 2025) and Villages Bancorporation (October 1, 2025, $829 million for 19 branches, $1.2 billion of loans and $3.5 billion of mostly low-cost deposits in North Central Florida and The Villages). Those deals were largely paid for in shares: weighted diluted shares rose from about 52 million in 2019 to 89 million in 2025, and earnings per share slipped from $1.90 to $1.57. Roughly 108.5 million shares are now the right base, because 11.25 million more are issuable on the convertible preferred stock issued to the Villages sellers. Values below are per that share count. What the business earns. We measure cash earnings after stock compensation, maintenance spending and expected loan losses. For a bank we deduct the annual loan-loss provision, because the cash loss on a bad loan shows up in investing activities and would otherwise be missed. We strip out working-capital swings (other assets and liabilities, mortgage inventory timing, lease accounting). Intangible amortization is added back, but the wasting nature of acquired deposits is reflected in the growth path rather than in the earnings level. On this basis per-share earnings ran between $1.24 and $2.14 over 2016-2025 (median about $1.56), but that history spans a doubling of the share count and a transformed bank. The first half of 2026 produced about $134 million, roughly $268 million annualized. We start from $230 million, or about $2.12 per share. Two adjustments: purchase-accounting accretion on acquired loans ($8.9 million in the second quarter, down from $12.1 million in the first, and worth about 18 basis points of the 3.83% margin) is removed because it fades with loan life, and loan-loss cost is normalized to 0.25% of loans against about 0.15% actually run in 2026. The $39.5 million first-quarter loss from repositioning the securities portfolio is treated as non-recurring; merger costs ($16.9 million in the half) are kept in, since this company does a deal nearly every year. Two consecutive quarters (about $63 million and $60 million of comparable net income) support the level; the conversion of the Villages branches finished in early July 2026 but no cost-savings target was disclosed, so none is credited. Growth credited. Last fiscal year per-share earnings rose 15% ($1.94 vs $1.69), mostly from acquisitions. We credit far less: 3% a year for five years and 2% for five more in the base case, funded by retained earnings (the dividend is $0.76 a year against about $2.12 earned), with capital needed for that growth deducted from cash available to owners. That sits below the roughly 4% a year demonstrated since 2016. Left out of every case: future acquisitions (the record shows they have not lifted per-share earnings), margin expansion, cost savings, the 16% annualized loan growth of one quarter, and the Georgia branch. Base case, about $34.50. The business is worth roughly $3.75 billion; deposits and borrowings are the raw material of a bank and their cost is already deducted from earnings, so nothing further is subtracted (the $113 million of long-term debt is likewise already charged). It includes an ordinary Florida credit cycle in years six and seven (losses of 1.0% and 0.8% of loans plus some margin pressure), then slow erosion of about 1% a year after year ten as acquired deposit relationships age. Bear case, about $20.00. One full downturn of the 2008-2010 Florida kind. Seacoast's own net charge-offs were 4.45% of loans in 2008 and 6.86% in 2009, with net losses of $45.6 million and $144.7 million and an $89 million share issue in 2009. Today only about 6% of loans are construction and land (CRE non-owner-occupied is about a third, including $536 million of office and $327 million of hotels), so we use about half that severity: losses of 2.2%, 3.4%, 2.0% and 1.0% of loans in years two to five (about $1.1 billion cumulatively), and revenue down roughly $58 million a year in years two to four. After-tax earnings are about breakeven in year two, negative about $129 million in year three and not back to normal until year six; earnings then settle at about 90% of today's level ($207 million) with a 2% annual decline after year ten. We also include another share-funded acquisition adding 10% to the share count but only 5% to earnings, matching past deals. Capital stays well above requirements (Tier 1 ratio was 14.5% at year-end 2025), so no dilution at trough prices is assumed. The business is worth about $2.2 billion and owes nothing separately. That is above tangible book value of about $17 per share because even after the cycle the franchise earns about 11% on tangible capital. Bull case, about $44. Growth of 5% a year for five years and 3% after (2025 organic loan growth was 9%, though 2024's was only about 2%), a mild one-year credit episode like 2020, and about $16 million a year by year four of added earnings from putting the Villages deposits to work (the acquired bank funded only $1.2 billion of loans with $3.5 billion of deposits); earnings hold flat after year ten. Testing the case. The most load-bearing assumption is the earnings level, so we tested the one disclosed item that could inflate it: acquired-loan accretion. Removing it entirely lowers the starting level by about $28 million, already done. Credit is currently clean (net charge-offs 0.10% in the second quarter; nonperforming loans 0.66%, down from 0.75% a quarter earlier). Unresolved: how much of the $3.5 billion of Villages deposits stays if the Villages developer relationship or rates change; we could not quantify that from the filings, and the 2025 Developer Support Agreement terms are not detailed in what we reviewed. Earlier figures for this company were built on a different basis and are not directly comparable; since then the Villages conversion finished, second-quarter net income reached $59.5 million, and share repurchases began (about 1.07 million shares so far in 2026). Margin-of-safety price, $15.00. We are fairly, not highly, sure of the $2.12 starting level: only two clean quarters exist since the Villages deal, and the accretion and loan-loss adjustments are judgments, so a fair range is $1.80 to $2.45. The worst plausible event is a Florida real-estate bust like 2008-09, when this company lost $190 million in two years and had to raise equity; today's deposit base (86% in low-cost savings, money-market and demand accounts), 78% loan-to-deposit ratio and capital would carry it, but a one-community deposit run-off, a major hurricane year, or another expensive share-funded deal are outcomes no case fully models. If we are wrong on the earnings level (say $1.80), the credit cycle's timing, or the Villages deposits, the shares are worth materially less than our base. The price assumes a holding period of four to five years; over that period the company pays $0.76 a share in dividends (over 5% at $15) and has begun repurchasing stock. At $15 the shares are priced at about 7 times what the business earns and under 90% of tangible book. An earnings yield of about 14% plus roughly 3% growth implies near 17% a year with no change in how the shares are valued, and a move to about 8.5 times earnings over five years implies roughly 20%.