Why did SRCE's Q1 earnings fall short of forecasts?

1st Source's (SRCE) Q1 earnings fell short of forecasts due to a combination of factors: |code|Ticker|Name|Date|Net Income|market_code| |---|---|---|---|---|---| |SRCE|SRCE.O|1st Source|2024 Q1|2.9462E7|185| |SRCE|SRCE.O|1st Source|2024 Q2|3.6805E7|185| |SRCE|SRCE.O|1st Source|2024 Q3|3.4914E7|185| |SRCE|SRCE.O|1st Source|2024 Q4|3.1437E7|185| 2. **Earnings Miss and Revenue Beat**: SRCE reported an EPS of $1.27, missing the estimate of $1.33, and a revenue of $97.85 million, slightly above the consensus. The net income of $31.44 million for Q4 2024 also indicates a decline from the previous quarter's $28.43 million. 3. **Analyst Ratings and Target**: Despite the challenges, Piper Sandler upgraded SRCE's rating to Overweight with a raised price target, suggesting confidence in the company's future performance. 4. **Specialty Finance Division Risk**: The Specialty Finance division, which accounts for over half of the company’s total, is at risk due to the resumption of tariffs on automobiles. This sector faces significant challenges from the tariffs, which could lead to lower demand for loans and increased credit risks. In conclusion, SRCE's Q1 earnings fell short due to a combination of lower-than-expected earnings, higher expenses, and risks associated with the company's Specialty Finance division. These factors, combined with the broader economic uncertainties, contributed to the earnings shortfall.