PRK

We rate PARK NATIONAL CORP /OH/ (PRK) as a Reduce with a composite score of 44.5/100 at a current price of $166.68. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential and elevated risk of underperformance relative to peers over the next 12 months.

The rating is primarily driven by strength in stability (60th percentile) and value (52th percentile), which together account for the majority of the composite score. Offsetting weakness in investment (32th percentile) and quality (35th percentile) tempers our overall conviction. We assign a Narrow Moat rating (45/100), Medium uncertainty, and Standard capital allocation.

Key items to watch: balance sheet deleveraging progress; sustainability of the current growth rate. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

PARK NATIONAL CORP /OH/ holds a top-quartile position (#0 of 50) within the Finance, Insurance, And Real Estate sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 44.5/100 places it at rank #2884 in our full 7,333-stock universe. At $2.6B in market capitalization, PARK NATIONAL CORP /OH/ is a mid-cap player in the Finance, Insurance, And Real Estate space, which limits certain scale advantages but may allow for more agile strategic execution.

Revenue is growing at 32%, though momentum at the 45th percentile suggests the market has not yet fully recognized this trajectory. This potential disconnect between fundamental improvement and market recognition could represent an opportunity for patient investors if the growth trend persists.

Available margin data shows operating margins of 34%. Incomplete margin data limits our ability to fully assess the cost structure and margin trajectory, though the available metrics provide a partial view of operating efficiency.

At a current price of $166.68, PARK NATIONAL CORP /OH/ is trading near fair value based on current fundamentals. Our value factor score of 52/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.

The stock currently trades at a P/E of 18.0x (a 51% premium to the sector median of 11.9x), EV/EBITDA of 14.5x (at a premium), P/B of 2.4x, P/S of 5.3x. The above-sector P/E multiple suggests the market is pricing in superior growth or quality, which our analysis finds only partially justified by current fundamentals.

We assign a Medium uncertainty rating to PARK NATIONAL CORP /OH/. The stock presents a balanced risk profile: significant leverage (640% debt-to-equity) and weak quality scores (35th percentile). While not risk-free, the core business fundamentals are adequate to withstand moderate economic stress, and the range of potential outcomes around our fair value estimate is manageable.

Specific risk factors that inform our assessment include: significant leverage (640% debt-to-equity); weak quality scores (35th percentile). Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 60th percentile and quality factor at the 35th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: a 2.93% dividend yield anchors total return. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.

We rate PARK NATIONAL CORP /OH/'s capital allocation as Standard. Management has shown adequate — though not exceptional — stewardship of shareholder capital. Returns on equity stand at 13.2%, and the balance sheet is managed within acceptable parameters (D/E: 640%). Exemplary allocators typically sustain ROE above 20% and D/E below 50%; PARK NATIONAL CORP /OH/ falls short on at least one dimension.

There is room for improvement in optimizing the capital structure or enhancing shareholder returns. The 2.93% dividend yield provides some income return, but the overall capital allocation framework would benefit from either higher reinvestment returns, improved balance sheet efficiency, or increased shareholder distributions. We will monitor for signs of strategic improvement that could warrant an upgrade.

In summary, PARK NATIONAL CORP /OH/ receives a Reduce rating with a composite score of 44.5/100 (rank #2884 of 7,333). Our quantitative framework assigns a Narrow Moat (45/100, trend: stable), Medium uncertainty, and Standard capital allocation. The average factor score across quality, value, momentum, stability, and investment is 45/100.

Our analysis does not support a constructive view on PARK NATIONAL CORP /OH/ at this time. The combination of the current quantitative profile, medium uncertainty, and standard capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.