OFG Bancorp (OFG) AI Stock Analysis

• Market Cap: $1.88B
• Dividend Yield: 2.63%
• Average Volume (3M): 231.92K
• Price to Earnings (P/E): 9.8
• Beta (1Y): 0.99
• Revenue Growth: 4.15%
• EPS Growth: 4.39%
• Country: US
• Employees: 2,223
• Sector: Financial
• Sector Strength: 68
• Industry: Banks - Regional
• EPS (TTM): 1.15
• Shares Outstanding: 44,913,113
• 10 Day Avg. Volume: 231,367
• 30 Day Avg. Volume: 231,921
• PEG Ratio: 7.20
• Price to Book (P/B): 1.50
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 8.52
• Enterprise Value/Market Cap: 0.61
• Enterprise Value/Revenue: 0.35
• Enterprise Value/Gross Profit: 2.00
• Enterprise Value/Ebitda: 1.00
• 1Y Price Target: $49.00
• Price Target Upside: 17.28% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 74 Outperform
• Price Target: $48.00 ▲(14.89%Upside)

OFG Bancorp's robust financial performance and positive earnings call sentiment are the primary drivers of its stock score. While technical analysis shows mixed signals, and valuation is fair, the company's strategic advancements and shareholder confidence bolster its overall appeal.

Positive Factors

Balance Sheet

Balance sheet trends were highlighted by continued loan growth, increased MBS holdings, and deposit mix shift.

Operating Trends

Stock reaction seems over-blown, as operating trends were roughly in line, with much of the miss tied to rate related MSR volatility.

Negative Factors

Credit Trends

Credit trends deteriorated more than anticipated, with NCOs increasing 11bps Q/Q to 90bps of avg. loans, mainly driven by higher auto NCOs.

Fees

Fees declined $5.6MM Q/Q hit by lower interchange fees, impacted by Durbin amendment, and lower MSR valuation.

OFG Bancorp Business Overview & Revenue Model

Company Description

OFG Bancorp, a financial holding company, provides a range of banking and financial services. It operates through three segments: Banking, Wealth Management, and Treasury. The company offers checking and savings accounts, as well as time deposit products; commercial, consumer, auto, and mortgage lending services; financial planning and insurance services; and corporate and individual trust, and retirement services. It also provides securities brokerage and investment advisory services, including various investment alternatives, such as tax-advantaged fixed income securities, mutual funds, stocks, and bonds to retail and institutional clients; and separately-managed accounts and mutual fund asset allocation programs. In addition, the company engages in the insurance agency and reinsurance businesses; administration and servicing of retirement plans; various treasury-related functions with an investment portfolio consisting of mortgage-backed securities, obligations of U.S. government sponsored agencies, and U.S. Treasury securities and money market instruments; and management and participation in public offerings and private placements of debt and equity securities. Further, it offers money management and investment banking services; and engages in the asset/liability management activities, such as purchases and sales of investment securities, interest rate risk management, derivatives, and borrowings. The company operates through a network of 50 branches in Puerto Rico and 2 branches in USVI. OFG Bancorp was founded in 1964 and is headquartered in San Juan, Puerto Rico.

How the Company Makes Money

OFG Bancorp makes money primarily through interest income from its lending activities, including commercial loans, consumer loans, and mortgages. The company also earns revenue from fees and commissions associated with its banking services, such as account maintenance fees, transaction fees, and charges for various banking products. Additionally, OFG generates income from its wealth management and investment services, which include advisory fees and commissions on investment products. The company's strategic partnerships and technology investments contribute to its ability to expand service offerings and improve customer engagement, thereby enhancing revenue potential.

OFG Bancorp Financial Statement Overview

Summary

OFG Bancorp exhibits strong financial performance with solid profitability and revenue growth. The income statement shows robust net profit margins, although there is a slight pressure on future earnings due to decreasing EBIT and net income in the TTM. The balance sheet is stable with low leverage, and cash flow generation remains strong despite some volatility in investing cash flows.

Income Statement

OFG Bancorp's income statement shows strong profitability with a consistent increase in total revenue, achieving a notable revenue growth from 2024 to TTM. The net profit margin is robust, reflecting effective cost management, and EBIT as well as EBITDA margins are healthy, demonstrating operational efficiency. However, the slight decrease in EBIT and net income in TTM compared to the previous annual results indicates potential pressure on future earnings.

Balance Sheet

The balance sheet of OFG Bancorp is characterized by a solid equity base, with a commendable equity ratio reflecting financial stability. The debt-to-equity ratio is low, indicating conservative leverage practices. Return on equity is strong, showcasing effective use of equity capital to generate profits. However, the decrease in cash and short-term investments suggests a potential need to monitor liquidity closely.

Cash Flow

OFG Bancorp's cash flow statement is positive with a strong operating cash flow to net income ratio, indicating efficient cash generation relative to earnings. Free cash flow has shown growth, providing flexibility for investments or debt reduction. However, the volatility in investing cash flows suggests significant capital expenditures or investments that need careful management.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	822.77M	728.15M	598.51M	540.58M	541.21M
Gross Profit	578.69M	579.50M	540.89M	497.03M	383.62M
EBITDA	280.54M	291.82M	268.53M	238.53M	118.58M
Net Income	198.17M	181.87M	166.24M	146.15M	74.33M
Balance Sheet
Total Assets	11.50B	11.34B	9.82B	9.90B	9.83B
Cash, Cash Equivalents and Short-Term Investments	2.93B	2.85B	1.96B	2.53B	2.60B
Total Debt	422.56M	224.80M	54.40M	95.07M	134.92M
Total Liabilities	10.25B	10.15B	8.78B	8.83B	8.74B
Stockholders Equity	1.25B	1.19B	1.04B	1.07B	1.09B
Cash Flow
Free Cash Flow	210.79M	277.80M	133.46M	76.99M	19.70M
Operating Cash Flow	252.50M	295.66M	164.46M	100.04M	34.96M
Investing Cash Flow	-335.98M	-1.40B	-1.51B	-182.93M	757.50M
Financing Cash Flow	-73.56M	1.31B	-124.70M	-49.04M	510.36M

OFG Bancorp Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 41.78
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OFG, the sentiment is Negative. The current price of 41.78 is below the 20-day moving average (MA) of 43.99, below the 50-day MA of 42.60, and above the 200-day MA of 41.41, indicating a neutral trend. The MACD of -0.05 indicates Positive momentum. The RSI at 39.64 is Neutral, neither overbought nor oversold. The STOCH value of 13.44 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OFG.

OFG Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CHCO	76 Outperform	$1.75B	14.55	16.70%	2.62%	8.28%	6.96%
NIC	76 Outperform	$1.90B	14.45	11.89%	0.92%	8.38%	26.81%
OFG	74 Outperform	$1.88B	9.85	15.20%	2.63%	4.15%	4.39%
FBNC	74 Outperform	$2.00B	20.61	6.55%	1.84%	-2.03%	-14.86%
Sector *	67 Neutral	$17.01B	11.59	9.13%	3.95%	10.67%	1.35%
MBIN	65 Neutral	$1.34B	6.42	12.43%	1.30%	4.14%	-30.76%
CASH	64 Neutral	$1.78B	9.90	22.79%	0.26%	3.78%	14.13%

OFG Bancorp Corporate Events

OFG Bancorp Elects Board and Approves Key Measures

At the annual meeting of shareholders held on April 30, 2025, OFG Bancorp successfully elected its board of directors for a one-year term, approved executive compensation on an advisory basis, and ratified the selection of KPMG LLP as its independent registered public accounting firm for the year ending December 31, 2025. These decisions reflect shareholder support for the company’s leadership and strategic direction, potentially strengthening its position in the financial services industry and providing stability for stakeholders.