Can Bank of Hawaii stock be sustainable? DA Davidson rates By Investing.com
On Tuesday, Bank of Hawaii (NYSE:BOH) stock received a revised rating from DA Davidson, a firm that expressed strong confidence in the bank’s performance. The target price was raised to $74.00 from the previous $65.00 while the Neutral rating was maintained.
The target price revision reflects the company’s belief that Bank of Hawaii is able to successfully navigate past top line pressures, evidenced by two consecutive quarters of increases in net interest income (NII) and net interest margin (NIM). The analyst noted that these financial metrics are expected to see further expansion. Additionally, the bank reported strong cash flow in the third quarter, and its credit quality was highlighted as a strength of the company.
Although the bank’s expenses were slightly higher than expected, DA Davidson expects a higher earnings per share (EPS) outlook for Bank of Hawaii. These expectations factor in positive financial indicators, including the aforementioned increases in NII and NIM, and strong capital income.
The company’s analysis concluded with a repeat rating of neutral, which corresponds to a new price target of $74. This position is based on the bank’s financial results and the expectation of continued growth in liquidity.
In other recent news, Bank of Hawaii Corporation reported third-quarter earnings that beat analyst estimates, with a significant increase in revenue of 18.4% from the previous quarter. The bank recorded net income of $40.4 million or $0.93 per diluted share, beating the expected earnings of $0.82 per share. Revenue came in at $162.73 million, beating the consensus estimate of $160.3 million.
Net profit margin saw a 2.4% quarter-over-quarter increase to $117.6 million, driven by higher yielding assets and balances, resulting in an increase in net profit margin to 2.18%. The bank’s total loans and leases increased 0.6% from the prior quarter to $13.9 billion, while total loans increased 2.8% to $21.0 billion.
As part of recent developments, Bank of Hawaii has maintained strong capital levels, and its Tier 1 capital ratio increased to 14.05% from 13.96% last quarter. The bank also announced a quarterly dividend payment of $0.70 per share, to be distributed to shareholders of record in late November. These events demonstrate the bank’s financial performance and commitment to shareholder returns.
InvestingPro Insights
Recent data from InvestingPro supports DA Davidson’s positive outlook on Bank of Hawaii (NYSE:BOH). The bank’s shares have shown significant momentum, with a price return of 15.92% over the past month and an impressive return of 56.19% over the past year. This performance supports the analyst’s decision to raise the target price.
InvestingPro Tips highlights that Bank of Hawaii has maintained dividend payments for 53 consecutive years, underscoring its financial stability and commitment to shareholder returns. This consistency in dividend payments may be particularly attractive to income-oriented investors in the current economic climate.
Additionally, the company’s P/E ratio of 19.82 suggests that the stock is fairly valued relative to its earnings, which may support analyst ratings of Neutral. For investors seeking a deeper understanding of Bank of Hawaii’s financial health and future prospects, InvestingPro offers 10 additional tips that can provide valuable insight into investment decisions.
This article was created with the support of AI and reviewed by an editor. For more information see our T&C.
