Hook / Thesis
Landmark Bancorp's pivot away from low-margin one-to-four-family residential mortgages toward commercial, commercial real estate (CRE) and agricultural loans appears to be working. Recent quarterly results show higher interest income, rising operating income and manageable credit costs. At the current price area - roughly $25.50 - you can set a defined-risk swing trade that leans on improving loan profitability, a steady dividend and a conservative balance sheet.
This is a tactical long. The setup: enter around $25.00, use a stop at $22.50 (about 11-12% risk), and take profits in two tranches at $30.00 and $34.00. Time horizon: 3-6 months, depending on the pace of loan growth and margin improvement.
What the company does and why the market should care
Landmark Bancorp Inc is the bank holding company for Landmark National Bank, concentrated in Kansas with branches across central, eastern, southeast and southwest Kansas. Management has signaled - and executed - a strategic shift toward originating more commercial, CRE and agricultural loans because those categories typically carry higher yields and cross-sell opportunities than traditional one-to-four-family residential lending.
Why that matters now: higher-yield loans convert faster to net interest income (NII) as deposit cost normalizes, and the bank has shown the first signs of that conversion in recent quarters. For an investor, improving NII plus contained credit costs = outsized earnings leverage at a small regional bank.
Support from the numbers
Look at the recent trajectory:
- Q3 2025 (period ended 09/30/2025, filing 11/13/2025): revenues held at $20.739 million and interest-and-dividend income was $20.739 million. Operating income was $6.061 million and net income attributable to the parent was $4.93 million. Diluted EPS in the quarter was $0.85.
- Q1 2025 (period ended 03/31/2025, filing 05/14/2025): revenues were $19.342 million with operating income of $5.716 million and net income of $4.701 million; diluted EPS was $0.81.
- Q3 2024 (period ended 09/30/2024, filing 11/13/2024): revenues were $19.022 million and net income was $3.931 million, diluted EPS $0.72.
That sequence shows a steady uptick in top-line revenue (from $19.02M to $20.74M year-over-year) and a more pronounced rise in net income ($3.93M to $4.93M year-over-year). Operating income also expanded (operating income of $6.061M in Q3 2025 vs $4.798M in Q3 2024). Importantly, provision-for-loan-and-lease losses remained modest: $0.85M in Q3 2025 compared with $0.50M in Q3 2024 and smaller or zero in other recent quarters, indicating credit costs are not spiking as the bank grows higher-yielding loans.
Balance-sheet scale is stable and conservative. As of Q3 2025, total assets were $1.617 billion and equity attributable to the parent was $155.727 million. Tangible asset growth with rising equity gives room to grow loans without stretching capital.
Finally, Landmark is a reliable dividend payer - the company declared a $0.21 quarterly cash dividend multiple times (most recently declared 10/29/2025 and paid 11/26/2025) - which supports income-oriented investors and acts as a price-floor in sideways markets.
Valuation framing - what I can and cannot do
The price action shows Landmark trading in the mid-$20s (previous close around $25.48). The public snapshot available for this analysis did not include a consistent, reliable outstanding-share or market-cap figure that I would trust for formal multiples (some share-count lines are inconsistent across filings), so I avoid producing P/E or price-to-book multiples here. That said, the case for the trade is not a cheap-multiple arbitrage so much as earnings momentum plus a steady dividend and contained credit costs.
Qualitatively, if earnings continue to convert (NII up, stable noninterest expense, low provisions) the stock should re-rate higher relative to recent ranges. The stock has traded between roughly low-$22 to high-$29 over the past year with occasional spikes into the $30s; my targets reflect a re-test of the $30 area first and a stretch target into the mid-$30s if momentum persists.
Catalysts (2-5)
- Quarterly earnings releases that show continued revenue and operating-income growth with provisions remaining under control (next key dates will be the regular quarter filings after 11/13/2025).
- Improving loan mix headlines - increased originations of commercial, CRE and agricultural loans that lift NII and NIM.
- Steady dividend declarations that confirm management priorities and support retail/income demand.
- Local economic tailwinds in Kansas (ag and small-business lending) that raise loan demand and reduce delinquencies.
Trade plan (actionable)
- Trade direction: Long.
- Entry: Accumulate 50-100% of planned position between $24.75 and $25.50; add up to full size through $26.50 if the stock shows strength on volume.
- Stop: $22.50 on a closing basis - this is a hard stop to respect the risk/reward (roughly 11-12% downside from current levels).
- Targets: Take partial profits at $30.00 (first target, ~18% upside from $25.48) and further profits at $34.00 (second target, ~33% upside). If the stock gaps strongly above $34, consider a trailing stop to capture further upside.
- Position sizing: limit exposure to a single-digit percentage of portfolio (e.g., 2-4%) given regional-bank idiosyncratic risk; reduce size if placing this trade as a momentum squeeze rather than core holding.
Risks (balanced section - at least four)
- Credit deterioration: A sudden rise in delinquencies in commercial or agricultural portfolios would force higher provisions and erase the earnings pivot. Watch provision trends and NPL ratios closely after each quarter.
- Deposit flight or funding pressure: Regional banks can be sensitive to deposit re-pricing or outflows; higher funding costs would compress margins rapidly.
- Interest-rate volatility: An unexpected rapid move in rates could compress loan demand (or force mark-to-market losses in securities), hurting NII and capital ratios.
- Execution risk on loan growth: Moving into commercial and CRE requires underwriting discipline and fee/cost execution. Faster growth without underwriting rigor would increase risk-weighted assets and regulatory scrutiny.
- Valuation ambiguity: With market-cap and share-counts not presented cleanly in the public snapshot used for this write-up, standard multiples are harder to rely on. That increases uncertainty around a fair value anchor for the position.
Counterargument to my thesis: If the market re-prices regional banks due to macro worries or a re-assessment of the CRE cycle, LARK could trade lower despite improving quarter-to-quarter earnings. In that scenario, the stock may require a longer time frame for fundamentals to show through, and the swing trade would turn into a position trade or reduction. Watch sector sentiment as well as company metrics.
What would change my mind
- I would reduce conviction or exit the trade if provisions rise materially (e.g., quarter-over-quarter provisioning spikes above the recent run-rate and NCOs begin to trend up).
- I would re-evaluate the thesis if deposits show sustained outflows or if the bank needs to materially re-price deposit costs to retain funding.
- A meaningful cut or suspension of the dividend would also change my view; the dividend has acted as a support and a sign of management confidence.
Bottom line
Landmark Bancorp is a small, regional bank that looks like it is executing a smart loan-mix pivot: revenues and net income are trending up, provisions remain modest and the bank continues to pay a $0.21 quarterly dividend. Those dynamics make LARK an attractive tactical long from current levels for a defined-risk swing trade. Use an entry around $25, a hard stop at $22.50, and targets at $30 and $34 while watching provisions, deposit trends and sector sentiment closely. If loan performance falters or funding stress appears, close the position quickly - this is a momentum/conviction trade that depends on clean execution by management.
Disclosure: This is a short-term trade idea and not specific financial advice. Do your own due diligence; position size according to your risk tolerance and portfolio parameters.