Bank of East Asia (BKEAY) AI Stock Analysis

• Market Cap: $5.03B
• Dividend Yield: 5.06%
• Average Volume (3M): 377.00
• Price to Earnings (P/E): 8.8
• Beta (1Y): 0.15
• Revenue Growth: -7.33%
• EPS Growth: 50.14%
• Country: US
• Employees: 7,880
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.11
• Shares Outstanding: 2,641,430,200
• 10 Day Avg. Volume: 1,094
• 30 Day Avg. Volume: 377
• PEG Ratio: 0.36
• Price to Book (P/B): 0.24
• Price to Sales (P/S): 1.61
• P/FCF Ratio: -3.00
• Enterprise Value/Market Cap: -3.36
• Enterprise Value/Revenue: -1.08
• Enterprise Value/Gross Profit: -1.08
• Enterprise Value/Ebitda: -4.57
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 60 Neutral
• Price Target: $2.00 ▲(14.94% Upside)

The score is held back primarily by weak cash generation (negative operating and free cash flow in 2023–2024) despite improving profitability and a stronger leverage profile. Valuation is a key support (low P/E and high dividend yield), while technicals are neutral-to-mixed with limited near-term momentum.

Positive Factors

Balance Sheet Health

A low debt-to-equity ratio indicates financial stability and prudent management, ensuring the bank's ability to withstand economic fluctuations.

Profitability Margins

Improving net profit margins suggest effective cost control and operational efficiency, which are crucial for long-term profitability and competitiveness.

Free Cash Flow Improvement

Significant growth in free cash flow enhances financial flexibility, allowing the bank to invest in growth opportunities and manage debt effectively.

Negative Factors

Negative Operating Cash Flow

Persistent negative operating cash flow could signal inefficiencies in core operations, potentially impacting liquidity and long-term sustainability.

Revenue Growth Decline

A decline in revenue growth can indicate challenges in market expansion or competitive pressures, potentially affecting future earnings and market position.

Cash Conversion Efficiency

A negative cash conversion ratio suggests difficulties in turning profits into cash, which could hinder the bank's ability to fund operations and growth.

Bank of East Asia Business Overview & Revenue Model

Company Description

The Bank of East Asia, Limited, together with its subsidiaries, provides various banking and related financial services. Its personal banking services include corporate, individual, savings, current, time deposit, and supreme accounts; and fixed and call deposits, foreign currency deposits, MAS services, and auto-payroll products, as well as safe deposit boxes and remittance services. The company also provides corporate banking services, such as SME loans and financing guarantee schemes; corporate and commercial financing products, including syndicated and construction loans, acquisition and structured financing, working capital financing, share financing and IPO-related loans, and commercial mortgages; trade finance services and expert trade solutions; factoring services; import and export trade finance; guarantee services; eTradeConnect that allows buyers and sellers to connect, transact, share information, and submit applications for financing through a single platform; cash management services; corporate wealth management products; foreign exchange and treasury products; trade settlement and financing services; onshore and offshore loans; and marine cargo, property, trade credit, employee compensation, pet, medical, life, savings, and endowment insurance plans. In addition, it offers private banking services comprising investment advisory services; investment solutions, such as unit trusts, linked deposits, currency trading and management, global equities and bonds investments, structured products, and options and derivatives; portfolio management services; securities and futures broking services; cyber banking, credit cards, and ATM; and various international services. The company operates 150 outlets in Hong Kong, rest of Greater China, Southeast Asia, the United Kingdom, and the United States. The Bank of East Asia, Limited was incorporated in 1918 and is headquartered in Central, Hong Kong.

How the Company Makes Money

The Bank of East Asia generates revenue through multiple streams, primarily from interest income, fees, and commissions. Interest income is derived from lending activities, including personal loans, mortgages, and corporate loans, where the bank earns interest on the principal amount lent to borrowers. Fees and commissions contribute significantly to revenue, originating from services such as account management, transaction processing, investment advisory, and wealth management. Additionally, the bank engages in treasury operations, involving foreign exchange trading and investment in securities, which also contribute to its earnings. Strategic partnerships and a focus on digital banking initiatives further enhance revenue generation by expanding customer reach and streamlining operations.

Bank of East Asia Financial Statement Overview

Summary

Earnings improved in 2024 (higher net income and better net margin) and leverage looks more conservative (debt-to-equity materially lower). However, operating cash flow and free cash flow were negative in both 2023 and 2024, which is a major offset and the primary financial risk.

Income Statement

Profitability looks solid and improving: net income rose from 4.12B (2023) to 4.61B (2024) and net margin improved to ~29.9% from ~28.3% (and well above 2020–2022 levels). Revenue growth turned positive in 2024 (+8.1%) after a small decline in 2023. The main weakness is volatility in revenue over time (large swings vs. 2022 and 2019) and inconsistent operating profitability signals in the data (EBIT margin shows as negative in multiple years despite positive EBIT), which reduces confidence in underlying trend quality.

Balance Sheet

Balance sheet appears conservatively levered versus equity: 2024 debt-to-equity is ~0.17, a sharp improvement from ~0.53–0.62 in 2020–2023, suggesting meaningful deleveraging. Equity is sizable (105.46B) relative to assets (877.76B), and returns on equity have been steady in the ~4–5% range (4.37% in 2024), indicating stability but not standout profitability. Key drawback: ROE remains modest and fairly flat, implying limited balance-sheet-driven earnings acceleration.

Cash Flow

Cash generation is the weak spot: operating cash flow was negative in 2023 (-16.92B) and remained negative in 2024 (-7.74B), with free cash flow also negative in both years (-17.60B and -8.28B). This represents a sharp deterioration from positive operating and free cash flow in 2020–2022 (notably 2022 operating cash flow of 10.41B and free cash flow of 9.86B). While the 2024 cash outflow improved versus 2023, the multi-year swing to negative cash flow raises questions around sustainability and funding needs.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	15.64B	15.43B	14.54B	28.61B	15.82B	12.31B
Gross Profit	15.64B	15.43B	44.25B	17.27B	15.82B	12.31B
EBITDA	3.70B	0.00	6.13B	5.82B	7.11B	0.00
Net Income	4.90B	4.61B	4.12B	4.36B	5.27B	3.61B
Balance Sheet
Total Assets	891.42B	877.76B	860.36B	882.83B	907.47B	884.42B
Cash, Cash Equivalents and Short-Term Investments	0.00	41.30B	89.59B	112.15B	120.64B	113.68B
Total Debt	10.97B	18.42B	14.70B	51.16B	58.95B	61.41B
Total Liabilities	781.68B	772.02B	752.03B	786.57B	805.39B	784.59B
Stockholders Equity	109.46B	105.46B	97.97B	95.99B	101.78B	98.89B
Cash Flow
Free Cash Flow	-10.87B	-8.28B	-17.60B	9.86B	1.71B	13.91B
Operating Cash Flow	-10.46B	-7.74B	-16.92B	10.41B	2.32B	14.51B
Investing Cash Flow	-182.00M	-318.00M	-511.00M	2.13B	2.67B	368.00M
Financing Cash Flow	-7.44B	4.94B	-1.74B	-31.28B	41.78B	4.06B

Bank of East Asia Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.74
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BKEAY, the sentiment is Positive. The current price of 1.74 is below the 20-day moving average (MA) of 1.80, below the 50-day MA of 1.74, and above the 200-day MA of 1.59, indicating a bullish trend. The MACD of 0.04 indicates Negative momentum. The RSI at 71.17 is Negative, neither overbought nor oversold. The STOCH value of 83.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BKEAY.

Bank of East Asia Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IBOC	80 Outperform	$4.61B	10.99	14.31%	2.03%	0.99%	4.94%
UCB	77 Outperform	$4.33B	13.69	9.23%	3.02%	5.63%	65.11%
TCBI	75 Outperform	$4.79B	15.22	8.60%	―	5.19%	3454.95%
ASB	74 Outperform	$4.78B	10.39	3.78%	3.51%	-1.44%	-21.65%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
BANF	64 Neutral	$3.88B	16.38	13.85%	1.70%	6.55%	12.94%
BKEAY	60 Neutral	$5.03B	8.76	4.41%	5.06%	-7.33%	50.14%