First Horizon (FHN) Stock Plunges 0.56% to 2025 Low on Revenue Decline, Margin Pressures

The share price of First Horizon (FHN) fell to its lowest level since September 2025 on Thursday, with an intraday decline of 1.03% before closing down 0.56%. The move reflects growing investor skepticism amid persistent challenges in the company’s financial performance and broader market uncertainties.

First Horizon’s stock has been pressured by a prolonged revenue decline, with annualized contraction of 6.3% over the past two years. While the bank narrowly exceeded earnings estimates in Q2 2025, analysts highlight that this single quarter’s performance cannot offset a broader trend of underperformance. Projected net interest income (NII) growth of just 3.4% over the next 12 months further underscores muted expectations for profitability expansion, deterring investors seeking high-growth opportunities.

Net interest margin (NIM) contraction has compounded concerns, with the metric averaging 3.3% over the past two years—a 20.3 basis point decline. Competitive pressures, asset-liability management challenges, and the Federal Reserve’s rate-cutting cycle have all contributed to eroding margins. With NIM already vulnerable, further rate cuts risk squeezing returns and limiting reinvestment capacity, according to analysts.

Institutional investor activity has added to the stock’s volatility. Major holders such as Jefferies and Phocas Financial reduced stakes in August 2025, while others like LSV Asset Management added new positions. Insider sales, including COO Tammy Locascio’s recent transactions, have also signaled mixed confidence. Despite a 12-month high in July and upgraded price targets from some analysts, the stock’s 1.3× forward price-to-book multiple remains seen as modest relative to its growth outlook.

Macroeconomic risks and strategic uncertainties further weigh on sentiment. The Fed’s easing cycle, while potentially boosting credit demand, threatens to compress margins. Analysts warn that without a clear pivot to address structural challenges—such as digital transformation or market diversification—First Horizon risks stagnation in a competitive regional banking landscape. Upcoming Q3 earnings on October 15 will be critical in determining whether recent gains are sustainable or fleeting.