Guaranty Bancshares: RSI Overbought, KDJ Death Cross Triggers Caution

According to the 15-minute chart of Guaranty Bancshares, the Relative Strength Index (RSI) has reached an overbought level, and the KDJ (Keltner Channel Divergence Indicator) has triggered a death cross at 09/04/2025 14:45. This suggests that the stock price has risen too quickly and is now unsupported by fundamentals, leading to a shift in momentum towards the downside. Consequently, there is a potential for further decreases in the stock price.

According to the 15-minute chart of Guaranty Bancshares (FGBI), the Relative Strength Index (RSI) has reached an overbought level, and the KDJ (Keltner Channel Divergence Indicator) has triggered a death cross at 09/04/2025 14:45. These technical indicators suggest that the stock price has risen too quickly and is now unsupported by fundamentals, leading to a shift in momentum towards the downside. Consequently, there is a potential for further decreases in the stock price.

Guaranty Bancshares, a regional bank with operations in Louisiana, Texas, Kentucky, and West Virginia, reported a significant loss in the second quarter of 2025. The bank's net loss for common shareholders reached $(6.4) million, compared to a $6.6 million profit in the same period last year [1]. Elevated credit costs, which weighed heavily on the bank's results, were a key factor in this decline. Provision expenses (GAAP) jumped to $14.7 million, more than double the figure from the previous year, as the bank tackled credit risk in its loan portfolio, particularly in commercial real estate [1]. The allowance for credit losses (GAAP) rose to $58.9 million, now 2.44% of total loans, up from 1.29% at the end of 2024 [1].

Despite the financial strain, Guaranty Bancshares made progress in operational efficiency. Noninterest expense (GAAP) decreased by $3.3 million to $17.3 million, driven largely by a 24.8% reduction in staff-related costs [1]. Additionally, non-performing assets fell by $6.8 million during the quarter, and delinquent loans reached multi-year lows [1]. A notable change was the reduction in the quarterly dividend from $0.16 to $0.01 per share, reflecting a shift towards capital preservation amid recent losses. This reduction did not disrupt the bank's record of consecutive quarterly dividends, now at 128 periods [1].

Looking ahead, the bank's focus is on asset sales, risk reduction, and expense containment, with no indication of new expansion plans or service launches. Key items for investors to monitor include further progress in reducing non-performing assets, the outcome of the pending sale of the company's largest real estate-owned (OREO) loan, and trends in deposit mix and costs [1].

References:
[1] https://www.nasdaq.com/articles/first-guaranty-posts-loss-costs-jump