Farmers National Banc (FMNB) stock is soaring 5.06% in Monday's intraday trading session following the release of its second-quarter earnings report for 2025, which exceeded analyst expectations and showed improvements in key financial metrics.

The community banking company reported earnings per share (EPS) of $0.37 for Q2 2025, slightly above the consensus estimate of $0.365. This represents a significant 19.4% year-over-year increase from $0.31 in Q2 2024. The company's net interest margin improved to 2.91%, up from 2.71% in the same quarter last year, driven by lower funding costs and steady loan growth. Net interest income rose 18.1% to $13.91 million, while the efficiency ratio improved to 56.7% from 60.8% in Q2 2024, indicating better operational efficiency.

However, the earnings report also highlighted some challenges for Farmers National Banc. Credit quality showed signs of weakening, with nonperforming loans rising to 0.84% of total loans in Q2 2025, up from 0.40% in Q2 2024. This increase was primarily attributed to two large commercial real estate relationships being moved into nonaccrual status. The company has responded by increasing its allowance for credit losses to 1.17% of loans, up from 1.05% in Q2 2024, and tripling its provision for credit losses to $3.5 million compared to the same quarter last year.