BOH - Bank of Hawaii: Cheap And With An Interesting Dividend Yield

2024-06-11 12:02:24 ET

Summary

• Bank of Hawaii has a depressed valuation with a low LTM Price / TBV per share compared to its 10-year average.
• The bank has a stable deposit base with a high level of trust among its clients, but its non-diversified business model poses some risks.
• Reinvestment opportunities can lead to improved profitability, even if the loan portfolio remains stalled.

Bank of Hawaii ( BOH ) is a dominant bank in the geographic area in which it operates and currently has a rather depressed valuation. In fact, its LTM Price / TBV per Share is only 1.80x, while the 10-year average is 2.55x.

This bank has a solid deposit base, and while the growth prospects for its loan portfolio are not exciting, the net interest margin could still increase in the coming quarters. As highlighted in my last article , unrealized losses remain the main problem, but the bank is doing what it can to improve its capital ratios....

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