MeritValue

ARROW FINANCIAL CORP

AROWdata completeness 88%17 fiscal years on file

Data notes: no data for concept 'revenue'; no data for concept 'pretaxIncome'

The thesis, from the filings

ARROW FINANCIAL CORP earns about 11% on equity, barely covering its ~9% cost of capital, and has bought back 3% of its shares over 5 years. The estimate methods put fair value between $27.6 and $37.45 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue—————
Net income$49.9M1$48.8M2$30.1M3$29.7M3$44M3
Operating cash flow$68.2M4$59.7M5$20.6M6$34.5M6$41.3M6
Capital expenditure$7.14M7$14.3M8$7.08M9$5.6M9$5.09M9
Free cash flow (derived)$61.1M4$45.5M5$13.5M6$28.9M6$36.2M6
Total debt$45M10$82.6M11$33M12$17.2M13$8.53M13
Cash & equivalents$457.7M14$64.7M15$142.5M15$154.5M15$214.2M15
Diluted shares17.1M17.1M17.0M16.7M16.5M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$261.64
your share of equity
Profit it earned you last year
$26.63
Free cash flow it threw off
$21.93
Debt you’d be carrying
$5.17

10 shares is a claim on $261.64 of net worth that earned you $26.63 and generated $21.93 of cash last year, against $5.17 of debt.

iii. Is this a good business?
Moat signal · return on equity
11% avg · 5y
FY21 13%FY22 14%FY23 8%FY24 7%FY25 10%

It earned about 11% on equity against a ~9% cost of capital — roughly what it costs to fund the business, so the numbers show no clear edge.

seeing a moat in the numbers →
Management signal · capital allocation
−3% shares · 5y

Share count is down 3% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has fallen 81% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $27.6 and $37.45 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$35.57
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$28.9M
DCF · Growth Exit 5Y
$37.45
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$28.9M
Earnings Power Value
$27.6
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$44M
  • growthAssumed0.0%
Graham Number
$39.5
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $37.45
The three cases
Bear0.0%$37.45
Base0.0%$37.45
Bull5.0%$43.5

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000717538-24-000047 (NetIncomeLoss)
  2. 10-K · period ending 2022-12-31 · accession 0000717538-25-000023 (NetIncomeLoss)
  3. 10-K · period ending 2023-12-31 · accession 0000717538-26-000037 (NetIncomeLoss)
  4. 10-K · period ending 2021-12-31 · accession 0000717538-24-000047 (NetCashProvidedByUsedInOperatingActivities)
  5. 10-K · period ending 2022-12-31 · accession 0000717538-25-000023 (NetCashProvidedByUsedInOperatingActivities)
  6. 10-K · period ending 2023-12-31 · accession 0000717538-26-000037 (NetCashProvidedByUsedInOperatingActivities)
  7. 10-K · period ending 2021-12-31 · accession 0000717538-24-000047 (PaymentsToAcquirePropertyPlantAndEquipment)
  8. 10-K · period ending 2022-12-31 · accession 0000717538-25-000023 (PaymentsToAcquirePropertyPlantAndEquipment)
  9. 10-K · period ending 2023-12-31 · accession 0000717538-26-000037 (PaymentsToAcquirePropertyPlantAndEquipment)
  10. 10-K · period ending 2021-12-31 · accession 0000717538-23-000132 (LongTermDebt)
  11. 10-K · period ending 2022-12-31 · accession 0000717538-24-000047 (LongTermDebt)
  12. 10-K · period ending 2023-12-31 · accession 0000717538-25-000023 (LongTermDebt)
  13. 10-K · period ending 2024-12-31 · accession 0000717538-26-000037 (LongTermDebt)
  14. 10-K · period ending 2021-12-31 · accession 0000717538-25-000023 (CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents)
  15. 10-K · period ending 2022-12-31 · accession 0000717538-26-000037 (CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents)