Hope Bancorp (HOPE) AI Stock Analysis

• Market Cap: $1.24B
• Dividend Yield: 5.45%
• Average Volume (3M): 721.32K
• Price to Earnings (P/E): 12.5
• Beta (1Y): 1.22
• Revenue Growth: -6.33%
• EPS Growth: -25.89%
• Country: US
• Employees: 1,244
• Sector: Financial
• Sector Strength: 77
• Industry: Banking
• EPS (TTM): 0.82
• Shares Outstanding: 120,767,790
• 10 Day Avg. Volume: 878,413
• 30 Day Avg. Volume: 721,321
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.67
• Price to Cash Flow (P/CF): 6.30
• P/FCF Ratio: 2.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $13.50
• Price Target Upside: 30.06% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

Hope Bancorp's overall score is a reflection of its strong balance sheet and positive earnings guidance, offset by challenges in profitability and cash flow. The technical analysis indicates caution due to current downward momentum, while the valuation is reasonable with a solid dividend yield. Strategic growth initiatives and strong capital ratios provide optimism for future performance.

Positive Factors

Deposit Growth

Non-interest bearing deposits increased sequentially, driving a positive mix shift.

Expense Management

Expenses are guided to decline by more than 7% compared to previously expected more than 5%, driven by benefits from reorganization and process improvements.

Loan Growth

Loan growth is expected to be driven by growth in residential mortgage, improving loan pipelines in CRE and C&I, and growth in SBA loan production.

Negative Factors

Credit Quality

Credit quality weakened as non-performing assets increased significantly.

Financial Performance

Core PPNR of $37 million was below the forecast of $46 million and consensus of $41 million.

Loan Growth

Loan growth was weaker than expected driven by elevated payoffs and paydowns in the C&I portfolio.

Hope Bancorp Business Overview & Revenue Model

Company Description

Hope Bancorp, Inc. is a bank holding company headquartered in Los Angeles, California, primarily serving the Korean-American community. It operates through its subsidiary, Bank of Hope, providing commercial banking services such as deposits, loans, and other financial products to small and medium-sized businesses, as well as individuals. The bank's offerings include personal and business checking and savings accounts, time deposits, and lending services including commercial real estate, small business administration (SBA), equipment, and consumer loans. Additionally, Hope Bancorp offers cash management services, mobile banking, and other digital banking solutions.

How the Company Makes Money

Hope Bancorp generates revenue primarily through interest income from its lending activities, which include commercial real estate loans, commercial and industrial loans, and consumer loans. The bank earns interest by charging borrowers a higher interest rate on loans than it pays on deposits. Another significant portion of its revenue comes from non-interest income, which includes fees for services such as account maintenance, transaction processing, and cash management. Hope Bancorp also earns revenue from its investment portfolio, which consists of government securities and other financial instruments. Strategic partnerships and community engagement within its target market further support its business model and customer base, contributing to its earnings.

Hope Bancorp Financial Statement Overview

Summary

Hope Bancorp's financial performance shows a stable balance sheet with strong financial health and low leverage risk. However, there are challenges in profitability and cash flow generation, requiring improvements for long-term success.

Income Statement

Hope Bancorp shows a mixed performance in its income statement. The gross profit margin remains stable as gross profit equals total revenue, typical for banking. The net profit margin has fluctuated, with a decline in 2024 compared to 2023, indicating reduced profitability. Revenue growth is inconsistent, with a notable increase in 2024 after a decrease in 2023. The EBIT margin decreased significantly in 2024, suggesting higher operating expenses relative to revenue. These factors reflect some financial strength but also highlight areas needing improvement, particularly in maintaining consistent profitability.

Balance Sheet

The balance sheet of Hope Bancorp is relatively stable. The debt-to-equity ratio was favorable in 2024 with no total debt, indicating strong financial health and reduced leverage risk. The equity ratio indicates a solid capital foundation, though it slightly decreased over the years. Return on equity shows variability, with a drop in 2024, pointing to challenges in generating returns on shareholder investments. Overall, the balance sheet reflects sound financial management with potential for improving shareholder returns.

Cash Flow

The cash flow statement shows some areas of concern for Hope Bancorp. Operating cash flow decreased substantially in 2024 compared to 2023, impacting the operating cash flow to net income ratio. Free cash flow growth was negative in 2024, indicating potential challenges in cash generation. However, the company managed financing activities well, reducing financing cash outflows. Improvements are needed in sustaining and growing free cash flow to ensure liquidity and operational flexibility.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
953.98M	571.44M	623.92M	551.96M	514.11M
	Gross Profit
953.98M	1.09B	623.92M	551.96M	514.11M
	EBIT
945.01M	197.66M	433.74M	275.27M	142.29M
	EBITDA
0.00	1.80M	0.00	0.00	0.00
	Net Income Common Stockholders
99.63M	133.67M	218.28M	204.57M	111.52M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
20.80M	1.93B	2.48B	2.98B	2.64B
	Total Assets
17.05B	19.13B	19.16B	17.89B	17.11B
	Total Debt
392.64M	1.90B	1.19B	621.56M	558.74M
	Net Debt
-65.56M	-24.97M	681.94M	305.30M	208.16M
	Total Liabilities
14.92B	17.01B	17.15B	15.80B	15.05B
	Stockholders Equity
2.13B	2.12B	2.02B	2.09B	2.05B
Cash Flow		Free Cash Flow
116.72M	460.65M	476.42M	316.99M	160.94M
	Operating Cash Flow
116.72M	473.78M	485.54M	324.21M	165.92M
	Investing Cash Flow
466.52M	1.29B	-1.47B	-993.04M	-1.83B
	Financing Cash Flow
-2.05B	-341.47M	1.18B	634.52M	1.32B

Hope Bancorp Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 10.38
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HOPE, the sentiment is Negative. The current price of 10.38 is below the 20-day moving average (MA) of 10.90, below the 50-day MA of 11.44, and below the 200-day MA of 11.81, indicating a bearish trend. The MACD of -0.34 indicates Positive momentum. The RSI at 28.53 is Positive, neither overbought nor oversold. The STOCH value of 21.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HOPE.

Hope Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PFBC	80 Outperform	$1.09B	8.41	17.92%	3.52%	8.03%	-8.05%
HAFC	72 Outperform	$657.37M	10.50	8.60%	4.74%	8.33%	-21.76%
EWBC	68 Neutral	$11.68B	10.13	15.89%	2.67%	13.84%	2.04%
UBOH	68 Neutral	$85.63M	8.92	9.70%	3.22%	13.06%	9.31%
HOPE	67 Neutral	$1.24B	12.50	4.68%	5.45%	-6.33%	-25.89%
CATY	64 Neutral	$2.99B	10.97	10.25%	3.13%	8.05%	-18.64%
Sector *	64 Neutral	$13.79B	10.52	9.20%	4.24%	17.25%	-7.60%

Hope Bancorp Corporate Events

Hope Bancorp Announces Director William J. Lewis’ Retirement

On March 11, 2025, Hope Bancorp announced that William J. Lewis, a director of the company, will retire and not seek re-election at the 2025 Annual Meeting of Stockholders. The company expressed gratitude for his service, clarifying that his decision was not due to any disagreements with the company’s operations, policies, or practices.

Hope Bancorp Reports Strong Earnings and Community Support

On January 27, 2025, Hope Bancorp reported its financial results for the fourth quarter and full year ending December 31, 2024. The company achieved a net income of $24.3 million for the fourth quarter and $99.6 million for the full year. Hope Bancorp’s pre-provision net revenue increased by 14% from the previous quarter, driven by growth in noninterest income and reduced noninterest expenses. The company’s asset quality improved, with reductions in criticized loans and nonperforming assets. Additionally, Hope Bancorp is preparing to integrate Territorial Savings Bank to enhance its deposit base and residential mortgage portfolio. In response to the wildfires in Greater Los Angeles, the bank has committed to supporting the community’s rebuilding efforts through donations.