OFG Bancorp (OFG) AI Stock Analysis

• Market Cap: $1.84B
• Dividend Yield: 2.93%
• Average Volume (3M): 210.41K
• Price to Earnings (P/E): 9.8
• Beta (1Y): 0.99
• Revenue Growth: 7.72%
• EPS Growth: 6.82%
• Country: US
• Employees: 2,223
• Sector: Financial
• Sector Strength: 73
• Industry: Banks - Regional
• EPS (TTM): 1.00
• Shares Outstanding: 44,913,113
• 10 Day Avg. Volume: 199,979
• 30 Day Avg. Volume: 210,412
• PEG Ratio: -0.63
• Price to Book (P/B): 1.16
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 12.54
• Enterprise Value/Market Cap: 0.28
• Enterprise Value/Revenue: 0.17
• Enterprise Value/Gross Profit: 0.72
• Enterprise Value/Ebitda: 0.44
• 1Y Price Target: $44.00
• Price Target Upside: 7.32% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 80 Outperform
• Price Target: $48.00 ▲(17.07%Upside)

OFG Bancorp's stock score is driven by its strong financial performance, characterized by robust revenue growth and a solid balance sheet. Its technical position is stable, with valuation metrics indicating potential undervaluation. The company's proactive digital strategy and supportive shareholder actions add to its positive outlook, despite some operational challenges.

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 impressive revenue growth and solid profitability metrics. The balance sheet is robust, characterized by minimal debt and substantial equity, which provides a cushion against economic downturns. Cash flow generation is healthy, although fluctuations in financing and investing activities could pose risks. The potential reporting anomaly in 2024 needs clarification.

Income Statement

OFG Bancorp's income statement demonstrates robust revenue growth over the years, with a noticeable increase in total revenue from $393 million in 2019 to $629 million in 2023. The company has maintained strong profitability, evidenced by consistent gross and net profit margins. Net income has grown steadily, reflecting efficient cost management and operational performance. However, the flat gross profit in 2024 is a concern, as the data suggests zero revenue, which may indicate a reporting error or a significant issue that needs addressing.

Balance Sheet

The balance sheet of OFG Bancorp is exceptionally strong, with a high equity ratio and no total debt in 2024, indicating a solid financial position and low leverage risk. The substantial stockholders' equity compared to liabilities underlines financial stability. The debt-to-equity ratio has been consistently low, enhancing the company's financial resilience. The equity ratio shows a healthy proportion of equity financing, supporting long-term sustainability.

Cash Flow

OFG Bancorp's cash flow statement reflects a positive trend in free cash flow, with significant growth from negative figures in 2020 to a positive $278 million in 2023, suggesting improved cash management. The operating cash flow to net income ratio is robust, indicating strong cash flow generation from operations. However, the variability in financing and investing cash flows points to potential volatility in capital expenditures and financing activities.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
822.77M	728.15M	598.51M	540.58M	432.84M
	Gross Profit
578.69M	579.50M	540.89M	497.03M	476.29M
	EBIT
346.07M	264.53M	332.54M	214.60M	114.57M
	EBITDA
280.54M	291.82M	268.53M	242.96M	116.39M
	Net Income Common Stockholders
198.17M	181.87M	166.24M	146.15M	74.33M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
591.14M	748.17M	1.96B	2.53B	2.60B
	Total Assets
11.65B	11.34B	9.82B	9.90B	9.83B
	Total Debt
347.34M	224.80M	54.40M	95.07M	134.92M
	Net Debt
-243.80M	-523.37M	-496.06M	-1.93B	-2.02B
	Total Liabilities
10.25B	10.15B	8.78B	95.07M	134.92M
	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	-103.88M
	Operating Cash Flow
252.50M	295.66M	164.46M	100.04M	-88.62M
	Investing Cash Flow
-335.98M	-1.40B	-1.51B	-182.93M	881.08M
	Financing Cash Flow
-73.56M	1.31B	-124.70M	-49.04M	510.36M

OFG Bancorp Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 41.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OFG, the sentiment is Neutral. The current price of 41 is below the 20-day moving average (MA) of 41.66, above the 50-day MA of 39.69, and below the 200-day MA of 41.64, indicating a neutral trend. The MACD of 0.26 indicates Positive momentum. The RSI at 47.56 is Neutral, neither overbought nor oversold. The STOCH value of 48.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OFG.

OFG Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OFG	80 Outperform	$1.84B	9.81	15.46%	2.93%	7.72%	6.82%
NIC	78 Outperform	$1.77B	14.13	11.47%	1.09%	10.78%	28.31%
CHCO	75 Outperform	$1.69B	14.64	16.25%	2.71%	8.80%	0.22%
CASH	71 Outperform	$1.77B	10.05	22.88%	0.27%	3.25%	11.22%
MBIN	70 Outperform	$1.43B	5.75	14.81%	1.28%	9.73%	-14.72%
Sector *	64 Neutral	$12.77B	9.71	7.85%	78.05%	12.07%	-7.97%
FBNC	63 Neutral	$1.69B	19.27	6.03%	2.16%	-2.00%	-23.83%

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.