Breaking Down First Hawaiian, Inc. (FHB) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments and wondering how First Hawaiian, Inc. (FHB) is performing? Did you know that in the fourth quarter of 2024, they reported a net income of $52.5 million, or $0.41 per diluted share? The company strategically restructured its investment portfolio, selling $290.4 million in low-yielding securities and reinvesting in $291.5 million in higher-yielding ones. Want to understand how these moves, along with an increase of $166.9 million in total loans and leases to $14.4 billion, and a deposit growth of $94.5 million reaching $20.3 billion, impact the financial health of FHB? Keep reading to discover key insights for investors!

First Hawaiian, Inc. (FHB) Revenue Analysis

Analyzing First Hawaiian, Inc.'s (FHB) revenue streams provides critical insights into the bank's financial health and operational performance. A detailed breakdown of revenue sources, growth rates, and segment contributions offers a comprehensive understanding for investors.

For the fiscal year ending December 30, 2024, First Hawaiian reported annual revenue of $980.04 million, marking a -13.43% decrease in growth. However, revenue for the last twelve months (TTM) reached $1.08 billion, showing a -9.92% increase.

Here's a summary of First Hawaiian's revenue trends:

• First Hawaiian had a revenue of $180.20 million in the quarter ending December 30, 2024, with -41.07%.
• Revenue (ttm) $1.08B.
• Revenue Growth 3.53%.
• Revenue/Employee $490,022.

A look at the historical annual revenue:

The company operates through three key segments:

• Retail Banking
• Commercial Banking
• Treasury

These segments provide a diversified product and service portfolio, with Retail Banking contributing a significant portion of the revenue.

For more insights into the company's values, see Mission Statement, Vision, & Core Values of First Hawaiian, Inc. (FHB).

First Hawaiian, Inc. (FHB) Profitability Metrics

Analyzing First Hawaiian, Inc. (FHB)'s financial health requires a close look at its profitability metrics. These metrics provide insights into how efficiently the company generates profit from its revenue and assets. Let's delve into the gross profit, operating profit, and net profit margins to understand FHB's profitability trends.

Here's a breakdown of key profitability metrics:

• Gross Profit Margin: This ratio indicates the percentage of revenue remaining after deducting the cost of goods sold. It reflects the company's efficiency in managing production costs.
• Operating Profit Margin: This margin shows the percentage of revenue remaining after deducting both the cost of goods sold and operating expenses. It reveals how well the company controls its operational costs.
• Net Profit Margin: The net profit margin represents the percentage of revenue that translates into net income. It is a comprehensive measure of overall profitability, taking into account all expenses, including taxes and interest.

To provide a clear picture of First Hawaiian, Inc.'s profitability, it's essential to examine these metrics over time. Trends in these margins can highlight improvements or declines in the company's ability to generate profit. For instance, an increasing net profit margin suggests enhanced efficiency and cost management.

A comparison with industry averages is also crucial. This benchmark helps investors understand whether First Hawaiian, Inc.'s profitability is in line with its peers or if it outperforms or underperforms the competition. Industry-specific factors can significantly influence these comparisons.

Operational efficiency plays a vital role in profitability. Effective cost management and favorable gross margin trends can contribute to higher profits. Investors should analyze how well First Hawaiian, Inc. manages its costs and how this impacts its overall profitability.

Here is a table summarizing potential areas to evaluate First Hawaiian, Inc.'s profitability:

Explore more about First Hawaiian, Inc. in our related article: Exploring First Hawaiian, Inc. (FHB) Investor Profile: Who’s Buying and Why?

First Hawaiian, Inc. (FHB) Debt vs. Equity Structure

Understanding how First Hawaiian, Inc. (FHB) manages its debt and equity is crucial for assessing its financial strategy and risk profile. This involves looking at the levels of debt FHB carries, how it compares to its equity, and how these choices align with industry practices.

Here's an overview of First Hawaiian, Inc.'s debt levels:

• Long-term debt: This includes obligations like bonds and loans that are due in more than a year.
• Short-term debt: This covers liabilities due within a year, such as short-term loans or the current portion of long-term debt.

Analyzing these components provides a clear picture of FHB's financing strategy.

The debt-to-equity ratio is a key metric in evaluating a company's financial leverage. It indicates the proportion of debt and equity a company uses to finance its assets. The debt-to-equity ratio is calculated by dividing a company’s total liabilities by its shareholder equity. Here's how to interpret it:

• Calculation: Total Debt / Shareholder Equity
• Interpretation: A higher ratio suggests a greater reliance on debt, which can amplify both profits and losses. A lower ratio indicates a more conservative approach with less financial risk.

Comparing FHB’s debt-to-equity ratio with industry averages offers insights into whether the company's leverage is typical for its sector or if it deviates significantly. As of the end of 2024 fiscal year, the average debt-to-equity ratio for banks in the United States was around 0.7.

Recent activities, such as new debt issuances, changes in credit ratings, or refinancing efforts, can significantly impact FHB's financial health. For example, a credit rating upgrade can lower borrowing costs, while refinancing can extend debt maturities or reduce interest rates. Keep an eye on these activities to understand how FHB is proactively managing its debt.

Balancing debt and equity is a strategic decision. Debt financing can provide capital for growth without diluting ownership, but it also increases financial risk. Equity funding, on the other hand, strengthens the balance sheet but can dilute existing shareholders' stakes. Here’s a simplified view:

For more insights, check out: Breaking Down First Hawaiian, Inc. (FHB) Financial Health: Key Insights for Investors

First Hawaiian, Inc. (FHB) Liquidity and Solvency

Liquidity and solvency are vital indicators of a financial institution's ability to meet its short-term obligations and long-term financial stability. For First Hawaiian, Inc. (FHB), analyzing these metrics provides insights into its operational efficiency and risk management.

Assessing First Hawaiian, Inc.'s Liquidity:

The current and quick ratios are fundamental in evaluating a company's liquidity position. These ratios indicate whether a company has sufficient liquid assets to cover its short-term liabilities. Here's a detailed look:

• Current Ratio: The current ratio, calculated by dividing current assets by current liabilities, measures First Hawaiian, Inc.’s ability to cover its short-term liabilities with its short-term assets.
• Quick Ratio: The quick ratio, which excludes inventories from current assets, provides a more conservative view of liquidity. It assesses First Hawaiian, Inc.’s ability to meet its short-term liabilities with its most liquid assets.

These ratios are crucial for understanding the immediate financial health of First Hawaiian, Inc. A higher ratio generally indicates a stronger liquidity position.

Analysis of Working Capital Trends:

Monitoring working capital trends helps in understanding First Hawaiian, Inc.'s operational efficiency. Working capital, the difference between current assets and current liabilities, reflects the funds available for day-to-day operations. Analyzing changes in working capital over time can reveal whether First Hawaiian, Inc. is effectively managing its short-term assets and liabilities.

Cash Flow Statements Overview:

Cash flow statements provide a comprehensive view of all cash inflows and outflows. These statements are categorized into three main activities:

• Operating Activities: Cash flow from operating activities reflects the cash generated from First Hawaiian, Inc.'s core business operations.
• Investing Activities: Cash flow from investing activities includes transactions related to the purchase and sale of long-term assets.
• Financing Activities: Cash flow from financing activities involves transactions related to debt, equity, and dividends.

Analyzing these cash flow trends provides insights into First Hawaiian, Inc.’s ability to generate cash, manage investments, and fund its operations.

Potential Liquidity Concerns or Strengths:

Identifying potential liquidity concerns or strengths involves a detailed analysis of the above factors. For instance, a decreasing current ratio or negative trends in operating cash flow could signal potential liquidity issues. Conversely, a strong current ratio and positive operating cash flow indicate a solid liquidity position. Continuous monitoring and analysis of these metrics are essential for assessing First Hawaiian, Inc.'s financial health and stability.

Here is a summary of key financial ratios and metrics that provide a snapshot of First Hawaiian, Inc.'s financial health:

For further insights, you can read more at: Breaking Down First Hawaiian, Inc. (FHB) Financial Health: Key Insights for Investors

First Hawaiian, Inc. (FHB) Valuation Analysis

Determining whether First Hawaiian, Inc. (FHB) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance analysis, and analyst sentiment. Let's delve into these aspects to provide a clearer picture for investors. You can find further details in our comprehensive analysis: Breaking Down First Hawaiian, Inc. (FHB) Financial Health: Key Insights for Investors

One of the primary methods for assessing valuation involves examining ratios like the price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA). These ratios offer insights into how the market values First Hawaiian, Inc. (FHB) relative to its earnings, book value, and operational cash flow. Keep in mind that these ratios should be compared against industry averages and historical data to derive meaningful conclusions.

Analyzing First Hawaiian, Inc. (FHB)'s stock price trends over the past 12 months, or even longer, provides a historical perspective on market sentiment and investor confidence. Significant price fluctuations may indicate periods of increased volatility or market reaction to company-specific news and broader economic events. As of April 18, 2024, FHB's stock demonstrated the following key metrics:

• 52 Week High: $22.74
• 52 Week Low: $18.27

These figures provide a range within which the stock has traded, offering a sense of its volatility and potential support and resistance levels. As of today, April 20, 2025, these values reflect the past year's performance and should be considered in the context of current market conditions.

Dividend yield and payout ratios are crucial for income-focused investors. A stable or increasing dividend yield, coupled with a sustainable payout ratio, suggests the company's commitment to returning value to shareholders. For First Hawaiian, Inc. (FHB), the dividend yield as of late 2024 was approximately 6.45%. The annual dividend rate was $1.12.

Here's a brief overview of First Hawaiian, Inc. (FHB)'s dividend history:

Finally, it is beneficial to consider analyst consensus on First Hawaiian, Inc. (FHB)'s stock valuation. A consensus of 'buy,' 'hold,' or 'sell' reflects the collective opinion of financial analysts covering the company, providing an external validation of the stock's potential. As of October 27, 2024, the consensus among analysts was to hold First Hawaiian, Inc. (FHB)'s stock. The average price target was $21.50.

First Hawaiian, Inc. (FHB) Risk Factors

First Hawaiian, Inc. (FHB) faces a variety of internal and external risks that could impact its financial health. These risks span industry competition, regulatory changes, market conditions, and specific operational and strategic challenges.

Industry Competition: The financial services industry is intensely competitive. First Hawaiian, Inc. (FHB) competes with other banks, credit unions, and non-bank financial institutions, some of which may have greater resources or a different risk appetite. Increased competition can put pressure on interest rates, reduce loan demand, and increase costs for acquiring and retaining customers. This dynamic can squeeze profit margins and affect overall financial performance. Mission Statement, Vision, & Core Values of First Hawaiian, Inc. (FHB).

Regulatory Changes: Banks are heavily regulated, and changes in laws and regulations can significantly impact First Hawaiian, Inc.'s (FHB) operations and profitability. Regulatory changes may include adjustments to capital requirements, lending restrictions, or consumer protection laws. Compliance with new regulations can be costly and time-consuming, potentially affecting the bank's ability to innovate and grow.

Market Conditions: Economic downturns, changes in interest rates, and fluctuations in the real estate market can all pose significant risks. For instance, rising interest rates can reduce demand for loans and increase the risk of defaults. A decline in the real estate market can lead to losses on mortgage-backed securities and a decrease in the value of collateral securing loans. These factors can adversely affect First Hawaiian, Inc.'s (FHB) financial condition and results of operations.

Operational Risks: These include risks related to internal processes, systems, and people. Examples include:

• Cybersecurity Threats: Banks are prime targets for cyberattacks. A successful breach could result in the loss of sensitive customer data, financial losses, and reputational damage.
• Credit Risk: The risk that borrowers will default on their loans. Effective credit risk management is crucial for maintaining a healthy loan portfolio.
• Liquidity Risk: The risk of not having enough cash to meet obligations. Banks must manage their assets and liabilities carefully to ensure they have sufficient liquidity.

Financial and Strategic Risks: These risks are often highlighted in earnings reports and filings. They include:

• Interest Rate Risk: Fluctuations in interest rates can affect a bank's net interest income, which is the difference between the income it earns on loans and the interest it pays on deposits.
• Strategic Risks: These involve decisions about the bank's business model, expansion plans, and investments. Poor strategic decisions can lead to financial losses and missed opportunities.

Mitigation Strategies: First Hawaiian, Inc. (FHB) likely employs various strategies to mitigate these risks. These may include:

• Diversification: Spreading its loan portfolio across different industries and geographic regions to reduce credit risk.
• Hedging: Using financial instruments to protect against interest rate risk.
• Compliance Programs: Implementing robust compliance programs to adhere to regulatory requirements.
• Investment in Cybersecurity: Investing in advanced cybersecurity technologies and training to protect against cyber threats.

Specific details on mitigation strategies and their effectiveness would typically be discussed in the company's annual reports, SEC filings, and investor presentations. Reviewing these documents would provide a more comprehensive understanding of how First Hawaiian, Inc. (FHB) manages its risk profile.

First Hawaiian, Inc. (FHB) Growth Opportunities

First Hawaiian, Inc. (FHB) faces a complex landscape of growth opportunities, influenced by economic conditions, strategic initiatives, and competitive dynamics. Evaluating these factors is crucial for investors seeking to understand the bank's potential trajectory.

Key growth drivers for First Hawaiian, Inc. (FHB) include:

• Market Expansion: Leveraging its strong presence in Hawaii to expand services and reach new customer segments.
• Digital Innovation: Investing in digital banking platforms to enhance customer experience and attract a tech-savvy clientele.
• Strategic Partnerships: Collaborating with local businesses and community organizations to strengthen its market position.

While specific revenue growth projections and earnings estimates for First Hawaiian, Inc. (FHB) beyond 2024 are not available in the provided search results, analyzing the bank's past performance and current initiatives can offer insights. For example, monitoring trends in net interest income, loan growth, and fee income can provide a basis for projecting future revenue.

Strategic initiatives that may drive future growth for First Hawaiian, Inc. (FHB) include:

• Technology Investments: Continued investment in technology to improve operational efficiency and customer service.
• Loan Portfolio Diversification: Diversifying the loan portfolio to reduce risk and capitalize on growth opportunities in different sectors.
• Community Engagement: Strengthening community relationships to build brand loyalty and attract new customers.

First Hawaiian, Inc.'s (FHB) competitive advantages that position the company for growth are:

• Strong Brand Reputation: A long-standing reputation for reliability and customer service in the Hawaiian market.
• Extensive Branch Network: A wide network of branches across the islands, providing convenient access for customers.
• Local Expertise: Deep understanding of the local market and customer needs.

Here is a table summarizing key financial data for First Hawaiian, Inc. (FHB) based on its 2024 fiscal year:

For more in-depth analysis, consider reading: Breaking Down First Hawaiian, Inc. (FHB) Financial Health: Key Insights for Investors