URSB Bancorp, Inc. (URSB) stock intrinsic value fair value estimate & owner earnings analysis

URSB Bancorp is the holding company for United Roosevelt Savings Bank, a small savings bank in Carteret, New Jersey (Middlesex County) that converted from mutual to stockholder ownership in the first quarter of 2026, selling 2,334,375 shares at $10.00. At June 30, 2026 it had $382 million of assets, $292 million of deposits and $318 million of loans. At year-end 2025 the loan book was $144 million of residential mortgages, $88 million of commercial real estate, $8 million of business loans, $35 million of professional loans bought from Bankers Healthcare Group and $27 million of consumer loans, mostly unsecured loans bought from Bankers Healthcare Group and Lending Club and auto loans bought through Woodside Credit. The purchased unsecured loans are new to the bank, bought only since 2025. Shareholders' equity is $39.5 million, about $18.70 per diluted share, roughly 10% of assets, and the bank's core capital is 9.1% of its assets. Earnings power. This is a low-return bank. Net income was $576,000 in 2024 and $503,000 in 2025 on about $20 million of capital, because heavy reliance on certificates of deposit and borrowings squeezes its net interest income. Cash earnings before loan-loss charges were about $1.0 million in 2024 and $1.6 million in 2025, but the 2025 figure is flattered by adding back an $801,000 loan-loss provision, mostly reserves for the newly bought consumer loans. For a lender, credit losses are a real recurring cost, so we value earnings after a normal credit charge rather than the cash figure with provisions added back. That leaves an underlying level of roughly $600,000 to $650,000 a year before the offering. The $20 million raised in early 2026 is being lent out (loans grew $17 million in the first half of 2026), and first-half 2026 net income was $380,000, with $225,000 in the second quarter, which already carries the new costs of the employee stock ownership plan and stock awards. We use about $850,000 a year, or $0.40 per share, as the normal earning power of the bank as it now stands. Net income fell 13% in 2025; the higher starting level rests on a specific, dated fact, the offering proceeds received in the first quarter of 2026, and is corroborated by two quarters of actual results. Because this is a lender, deposits and Federal Home Loan Bank advances are treated as the raw material of the business and no debt is subtracted. The holding company also owes $6.8 million of senior notes at about 6.2% ($4.0 million due in 2026, $1.2 million in 2027, $1.6 million in 2028); the offering cash comfortably covers them and their interest is already inside the earnings figure. Base case: earnings hold at about $850,000 a year with no growth credited. Deposits grew strongly in 2025 (up $45 million) but slowly in 2024 ($14 million), and growth that depends on winning market share is not counted. What keeps the earnings going is a long-established local deposit franchise. The business is worth about $14.2 million, or $6.70 per share. Bear case: earnings settle back near the pre-offering level of about $600,000 a year as funding costs stay high, and the bank goes through a credit cycle like 2008-2010 in years three to five. Using that period's loss experience by loan type (about 1.5% on residential mortgages, 4% on commercial real estate, 5% on business loans and around 10% on the unsecured professional and consumer loans), losses come to roughly $12 million before tax against a $2.5 million reserve, consuming about $7.5 million of after-tax capital, more than a decade of earnings. Core capital would fall to roughly 7% of assets, still above the level regulators treat as well capitalized, so no new shares would need to be sold. The bank is worth about $4.1 million, or $1.92 per share, far below its book capital, because a bank earning this little cannot justify its book value through a downturn. Bull case: the offering money is fully lent out at the pace already shown in 2026 and earnings reach about $1.3 million a year from the second year onward, still only about a 3% return on equity. That is worth about $21.2 million, or $10.05 per share. A sale of the bank or large buybacks after the first anniversary of the offering are common for converted thrifts but have not happened, so they are left out of every case. Margin of safety price. We are reasonably sure of the earnings level, since two quarters of post-offering results line up with the arithmetic of lending out the new capital, but that level is very low relative to the capital in the business, and the purchased unsecured loans, with only about a year of history at this bank, are the part of the book most likely to surprise. The worst plausible outcome is a severe recession in which the bought consumer and professional loans perform far worse than expected while New Jersey commercial real estate weakens at the same time; with 10% equity to assets, a mostly residential mortgage book and only small holding-company notes, the bank would very likely survive without dilution, and its hard capital is a cushion no case fully credits. If we are wrong about funding costs or credit, the value sits near the bear figure of about $2; if we are wrong about how much the new capital can earn, the shares are worth $10 or more. The price assumes a holding period of three to five years, and the company pays no dividend, so the return has to come from retained earnings and the shares moving toward the value of those earnings. At $3.00 a share the bank earns about 13% of the price each year and sits on more than $18 of capital per share, and the base case implies the required return if the shares approach the base value over about four years; above that price the thin earnings leave too little room for a credit cycle. The margin of safety price is $3.00. Since the previous analysis there has been no new filing or change in the business; the estimates are essentially unchanged, with the bull case refined slightly. Accounting notes: before 2026 the company was a mutual with no shares, so per-share figures for 2024 and 2025 use the first post-offering diluted share count of about 2.11 million, which excludes unallocated employee stock ownership plan shares. Detailed annual data exists only for 2024 and 2025, so the earnings history is short and the estimates carry more uncertainty than usual.