Yahoo Finance Bank of Hawaii Corporation (NYSE:BOH) Just Reported First-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?
Investors in Bank of Hawaii Corporation (NYSE:BOH) had a good week, as its shares rose 3.5% to close at US$58.20 following the release of its quarterly results. Revenues came in 2.1% below expectations, at US$156m. Statutory earnings per share were relatively better off, with a per-share profit of US$0.87 being roughly in line with analyst estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Check out our latest analysis for Bank of Hawaii
Following last week's earnings report, Bank of Hawaii's three analysts are forecasting 2024 revenues to be US$636.1m, approximately in line with the last 12 months. Statutory earnings per share are forecast to decrease 9.2% to US$3.49 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$651.6m and earnings per share (EPS) of US$3.69 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.
The analysts made no major changes to their price target of US$57.33, suggesting the downgrades are not expected to have a long-term impact on Bank of Hawaii's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Bank of Hawaii, with the most bullish analyst valuing it at US$65.00 and the most bearish at US$46.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Bank of Hawaii shareholders.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.5% by the end of 2024. This indicates a significant reduction from annual growth of 2.0% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.9% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Bank of Hawaii is expected to lag the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Bank of Hawaii. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at US$57.33, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Bank of Hawaii going out to 2025, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for Bank of Hawaii you should know about.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
