Cathay General Bancorp (CATY) AI Stock Analysis

• Market Cap: $3.25B
• Dividend Yield: 2.89%
• Average Volume (3M): 337.23K
• Price to Earnings (P/E): 10.9
• Beta (1Y): 0.85
• Revenue Growth: -1.59%
• EPS Growth: 9.34%
• Country: US
• Employees: 1,266
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 1.13
• Shares Outstanding: 68,036,610
• 10 Day Avg. Volume: 367,586
• 30 Day Avg. Volume: 337,233
• PEG Ratio: -0.64
• Price to Book (P/B): 1.21
• Price to Sales (P/S): 2.47
• P/FCF Ratio: 10.54
• Enterprise Value/Market Cap: 1.08
• Enterprise Value/Revenue: 2.60
• Enterprise Value/Gross Profit: 6.62
• Enterprise Value/Ebitda: 9.23
• 1Y Price Target: $50.67
• Price Target Upside: 7.63% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 3
• EPS Forecast (FY): 4.42
• Revenue Forecast (FY): $796.05M

• Rating: 66 Neutral
• Price Target: $49.00 ▲(4.08% Upside)

Cathay General Bancorp's overall score reflects its strong profitability and stable financial position, offset by challenges in revenue growth and cash flow. The stock's valuation is attractive, but technical indicators suggest bearish momentum. The earnings call provided mixed signals, with notable growth in income and loans but concerns over rising charge-offs and expenses.

Positive Factors

Strong Loan Growth

The significant increase in loans, particularly in commercial and real estate sectors, indicates strong demand for the bank's services and supports future revenue growth.

Effective Cash Management

Steady cash generation and effective cash management enhance the company's ability to invest in growth opportunities and maintain financial stability.

Improvement in Deposit Growth

Growth in core deposits strengthens the bank's funding base, supporting lending activities and enhancing financial flexibility.

Negative Factors

Increase in Net Charge-Offs

Rising net charge-offs indicate potential credit quality issues, which could impact profitability and require increased provisioning.

Rise in Classified Loans

An increase in classified loans suggests deteriorating asset quality, posing risks to financial stability and requiring careful management.

Increase in Nonaccrual Loans

Higher nonaccrual loans reflect credit risk and may lead to reduced interest income, affecting overall financial performance.

Cathay General Bancorp Business Overview & Revenue Model

Company Description

Cathay General Bancorp operates as the holding company for Cathay Bank that offers various commercial banking products and services to individuals, professionals, and small to medium-sized businesses in the United States. The company offers various deposit products, including passbook accounts, checking accounts, money market deposit accounts, certificates of deposit, individual retirement accounts, and public funds deposits. It also provides loan products, such as commercial mortgage loans, commercial loans, small business administration loans, residential mortgage loans, real estate construction loans, and home equity lines of credit, as well as installment loans to individuals for household, and other consumer expenditures. In addition, the company offers trade financing, letter of credit, wire transfer, forward currency spot and forward contract, traveler's check, safe deposit, night deposit, social security payment deposit, collection, bank-by-mail, drive-up and walk-up window, automatic teller machine, Internet banking, investment, and other customary bank services, as well as securities and insurance products. As of March 1, 2022, it operated 31 branches in Southern California, 16 branches in Northern California, 10 branches in New York, four branches in Washington, two branches in Illinois, and two branches in Texas, as well as one branch each in Maryland, Massachusetts, Nevada, and New Jersey, and Hong Kong; and a representative office each in Beijing, Taipei, and Shanghai. The company was founded in 1962 and is headquartered in Los Angeles, California.

How the Company Makes Money

Cathay General Bancorp generates revenue primarily through interest income from loans and investment securities, as well as non-interest income from various banking services. The key revenue streams include interest earned on commercial and residential loans, which constitute a significant portion of their earnings. Additionally, the bank earns fees from deposit accounts, service charges, and other transactional services. Investment in securities also contributes to interest income. The company benefits from its strong reputation within the Asian-American community, fostering customer loyalty and driving business growth. Furthermore, strategic partnerships with local businesses and community organizations enhance its market presence and customer base, positively impacting its financial performance.

Cathay General Bancorp Financial Statement Overview

Summary

Cathay General Bancorp shows strong profitability margins and a stable balance sheet with low leverage. However, the decline in revenue growth and free cash flow generation poses risks to future growth and liquidity.

Income Statement

Cathay General Bancorp's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) data indicates a decline in revenue growth rate by 45.5%, which is concerning. However, the company maintains healthy margins with a gross profit margin of 51.28% and a net profit margin of 21.44%. The EBIT and EBITDA margins are also strong at 25.31% and 26.51%, respectively, indicating efficient cost management. Despite the revenue decline, the company remains profitable, but the negative growth trend poses a risk.

Balance Sheet

The balance sheet of Cathay General Bancorp reflects a stable financial position. The debt-to-equity ratio is low at 0.20, indicating prudent leverage management. The return on equity (ROE) is 10.31%, which is decent for the banking industry, showing effective use of equity to generate profits. The equity ratio stands at 12.16%, suggesting a solid equity base relative to total assets. Overall, the balance sheet demonstrates financial stability with manageable debt levels.

Cash Flow

Cathay General Bancorp's cash flow statement reveals some challenges. The free cash flow growth rate is negative at -2.90%, indicating a decline in cash generation. However, the operating cash flow to net income ratio is low at 1.65%, and the free cash flow to net income ratio is high at 98.14%, suggesting that the company is effectively converting its net income into cash. While cash flow generation is a concern, the company maintains a strong conversion rate of income to cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.35B	1.39B	1.31B	908.10M	721.11M	743.39M
Gross Profit	529.74M	692.22M	784.06M	775.97M	668.37M	537.43M
EBITDA	379.77M	334.37M	421.69M	492.34M	397.96M	270.48M
Net Income	304.81M	285.98M	354.12M	360.64M	298.30M	228.86M
Balance Sheet
Total Assets	24.08B	23.05B	23.08B	21.99B	20.89B	19.04B
Cash, Cash Equivalents and Short-Term Investments	1.81B	1.70B	2.43B	2.63B	3.58B	2.46B
Total Debt	119.14M	227.73M	709.72M	659.25M	192.97M	326.33M
Total Liabilities	21.17B	20.21B	20.34B	19.51B	18.44B	16.62B
Stockholders Equity	2.90B	2.85B	2.74B	2.47B	2.45B	2.42B
Cash Flow
Free Cash Flow	399.35M	325.52M	381.34M	464.00M	330.59M	314.18M
Operating Cash Flow	400.33M	329.15M	384.74M	467.39M	334.32M	319.95M
Investing Cash Flow	-891.04M	184.03M	-1.48B	-1.85B	-859.92M	-242.20M
Financing Cash Flow	460.01M	-302.47M	758.74M	94.74M	1.55B	749.55M

Cathay General Bancorp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 47.08
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CATY, the sentiment is Positive. The current price of 47.08 is above the 20-day moving average (MA) of 46.47, below the 50-day MA of 47.86, and above the 200-day MA of 45.18, indicating a neutral trend. The MACD of -0.27 indicates Negative momentum. The RSI at 51.31 is Neutral, neither overbought nor oversold. The STOCH value of 89.55 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CATY.

Cathay General Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INDB	78 Outperform	$3.49B	17.17	5.51%	3.34%	11.05%	-10.78%
FBP	74 Outperform	$3.21B	9.88	18.43%	3.41%	2.35%	13.72%
FIBK	71 Outperform	$3.34B	13.69	7.20%	5.80%	-5.43%	4.19%
FULT	69 Neutral	$3.21B	9.23	10.92%	4.04%	9.60%	20.38%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
CATY	66 Neutral	$3.25B	10.86	10.63%	2.89%	-1.59%	9.34%
TBBK	65 Neutral	$2.74B	13.43	28.59%	―	29.24%	21.49%

Cathay General Bancorp Corporate Events

Cathay General Bancorp Reports Steady Q3 2025 Results

Cathay General Bancorp is a publicly traded holding company for Cathay Bank, providing a range of financial services across the United States and internationally, with a focus on serving the banking needs of its diverse clientele.

Cathay General Bancorp Reports Q3 2025 Financial Results

Cathay General Bancorp announced its financial results for the third quarter of 2025, reporting a net income of $77.7 million, or $1.13 per diluted share. The company saw a slight increase in net interest margin and total loans, while also increasing its provision for credit losses due to specific loan reserves. The results reflect a stable financial performance with a focus on managing credit risk and maintaining profitability.

The most recent analyst rating on (CATY) stock is a Hold with a $49.00 price target. To see the full list of analyst forecasts on Cathay General Bancorp stock, see the CATY Stock Forecast page.