Blue Ridge Bankshares Gains 33.7% in 6 Months: How to Play the Stock?

Blue Ridge Bankshares, Inc. BRBS investors have been experiencing some short-term gains from the stock lately, despite its bumpy ride over recent months. Shares of the Richmond, VA-based holding company of Blue Ridge Bank, National Association and BRB Financial Group, Inc., have gained 33.7% in the past six months compared with the industry’s 19.7% rise. In the same time frame, the stock also outperformed the sector and the S&P 500’s 9.6% and 15.7% gain, respectively.

Two key recent developments for BRBS include the receipt of the notification from its primary regulator, the Office of the Comptroller of the Currency, terminating the Consent Order dated Jan. 24, 2024 (in November) and the release of its third-quarter 2025 results (in October). The company posted a solid increase in both net interest income and noninterest income over the period. Results were noticeably stronger than in recent quarters, supported by a one-time boost from the payoff and recovery of certain previously troubled credits, as well as improved fee-based revenue. Meanwhile, management’s ongoing cost-control initiatives helped bolster profitability.

Blue Ridge Bankshares’ leadership highlighted continued efforts to de-risk the balance sheet, including completing its exit from fintech/BaaS (banking-as-a-service)-related deposits and further cutting back on non-core loan exposure. Management believes these steps leave BRBS better positioned to shift focus back toward growth in traditional core banking going forward.

BRBS’ Six Months Price Comparison

Over the past six months, the stock underperformed its peers like Franklin Financial Services Corporation FRAF but outperformed its other peer, AmeriServ Financial, Inc. ASRV. Franklin Financial’s and AmeriServ Financial’s shares have gained 55.1% and 0.7%, respectively, in the same time frame.

Despite several challenges within the banking industry, including heightened competition for deposits and customers, the favorable share price movement indicates that the company might be able to maintain the positive market momentum at present.

Blue Ridge Bankshares operates as a community banking franchise with a presence across multiple markets in Virginia and North Carolina. The company provides a wide range of retail and commercial banking services, as well as wealth management and trust/estate offerings via Blue Ridge Bank and its affiliated subsidiaries. Its branch-centered network in attractive local markets, together with recent additions to leadership and a renewed emphasis on relationship-based banking, supports its longer-term growth prospects.

Blue Ridge Bankshares Strong Fundamentals Weigh In

The removal of a major regulatory constraint has become a meaningful catalyst for Blue Ridge Bankshares’ stock. In November 2025, the company announced that the Office of the Comptroller of the Currency had terminated its Consent Order, marking the completion of a multi-quarter remediation effort. Management noted that this milestone enhances the bank’s flexibility to grow and expand in its core markets and signals improved regulatory standing. The end of the Consent Order also removes an overhang that had weighed on sentiment, allowing investors to better focus on the company’s underlying franchise and strategic direction.

Another key driver is BRBS’s deliberate de-risking of its business model. The company has fully exited fintech/BaaS-related deposits and reduced non-core and out-of-market loan exposure, transitioning back toward a more traditional community banking profile. This shift has strengthened asset quality, simplified the balance sheet and improved the stability of the deposit base. Management views these actions as positioning the bank for more sustainable, relationship-driven growth rather than reliance on higher-risk or volatile funding sources.

Finally, BRBS’s solid capital position is supporting direct shareholder returns and reinforcing confidence in its turnaround. The board declared a special cash dividend and authorized a share repurchase program, actions that management described as reflecting both regulatory affirmation and financial strength. These capital actions, alongside improving profitability trends, enhance the stock’s appeal to investors seeking value and income within the community banking space.

Challenges Ahead for BRBS

Two notable challenges remain for Blue Ridge Bankshares. Despite ongoing de-risking, asset quality bears monitoring, as nonperforming loans increased sequentially during the recent quarter, reflecting lingering exposure within the loan portfolio. In addition, the bank faces pressure to rebuild deposits organically following its fintech/BaaS exit, while managing interest-rate sensitivity and competitive funding conditions that could constrain margin stability.

Blue Ridge Bankshares’ Stock’s Valuation

BRBS’ trailing 12-month P/S of 2.8X is higher than the industry’s average of 2.3X and its three-year median of 1.1X.

Franklin Financial’s and AmeriServ Financial’s trailing 12-month P/S currently stand at 1.9X and 0.6X, respectively, in the same time frame.

Our Final Take on BRBS

There is little doubt that Blue Ridge Bankshares is well-positioned from a fundamental standpoint, supported by a strengthened core banking franchise, improving profitability, a cleaner balance sheet, and solid capital levels. These attributes provide a constructive backdrop for the company’s longer-term growth as it refocuses on traditional community banking following its strategic reset. As a result, existing investors have a reasonable case to remain invested to benefit from potential continued progress, while the recent upward momentum in the share price may also attract incremental interest from new investors.

That said, valuation tempers near-term enthusiasm. BRBS is trading at a premium to the broader banking peer group as well as its own historical norms, indicating that the market is already factoring in strong execution as the turnaround progresses. With limited scope for gains from simple re-rating, future upside is likely to depend on continued delivery in core loan and deposit growth, funding stability, and profitability. For existing investors, the premium can be justified if operating momentum is sustained, supporting a hold stance for now.

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This article originally published on Zacks Investment Research (zacks.com).

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