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Is Bank of Hawaii (BOH) Worth a Look on 6.68% Dividend Yield?
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Bank of Hawaii Corporation (BOH - Free Report) is a solid dividend-yielding stock that investors may keep on the radar amid the current turmoil in the banking industry and looming recession fears in the near term.
Headquartered at Honolulu, HI, Bank of Hawaii Corporation is a bank holding company, which provides a broad array of products and services in Hawaii, Guam and other Pacific Islands.
BOH has been paying its quarterly dividend on a regular basis and raising it occasionally. The last hike of 4.5% to 70 cents per share was announced in July 2021. In the past five years, it increased dividends four times, with an annualized dividend growth rate of 2.90%.
Considering last day’s closing price of $41.92 per share, the company’s current dividend yield is 6.68%. This is impressive compared with the industry’s average of 3.2%, attracting investors as it represents a steady income stream.
Is the Bank of Hawaii stock worth a look to earn a high dividend yield? Let’s check the company's financials to understand the risks and rewards.
Apart from regular quarterly dividend payouts, BOH has a steady share repurchase program in place. In January 2023, the company's board of directors announced an additional share buyback authorization of $100 million. As of Mar 31, 2023, $126 million remained available under the program.
As of Mar 31, 2023, the company’s securities sold under agreements to repurchase and other debt, aggregated to $1.24 billion, up sequentially. Nonetheless, the total liquidity stood at $10.1 billion as of the same date. The high quality of the asset base provides the company with ample liquidity access. Given substantial liquidity lines, we believe that Bank of Hawaii will continue to enhance shareholder value through its capital deployment activities.
Organic growth remains a key strength at BOH. The company’s deposit base saw a five-year (2018-2022) compound annual growth rate (CAGR) of 8.2%, whereas net loans and leases witnessed a CAGR of 6.9% during the same time frame. Nonetheless, its diversified and long-duration deposit base, along with diversified and lower-risk loan assets, positions the company to maintain a robust balance sheet.
Going forward, strong deposit balances will also help the company generate higher loans and pursue other general business purposes. We anticipate total deposits, and net loans and leases to increase 4.8% and 4.4%, respectively, in 2023.
Also, revenues witnessed a CAGR of 1.7% over the last five years (2017-2022). The uptrend in revenues continued in the first quarter of 2023. Revenue growth was supported by a rise in NII, backed by rising rates. With the Federal Reserve expected to keep the interest rates high in the near term, the same is likely to support Bank of Hawaii’s NII and net interest margin (NIM) growth. We project NII to decline in 2023 but rebound at 0.1% and 2.4% in 2024 and 2025, respectively.
Despite the near-term headwinds, including rising expenses and declining fee income, BOH stock is fundamentally solid.
Therefore, income investors should keep this stock on their radar as this will help generate robust returns over time.
Bank Stocks With Solid Dividends
Banking stocks like Truist Financial Corporation (TFC - Free Report) and U.S Bancorp (USB - Free Report) are worth a look as these, too, have robust dividend yields.
Considering the last day’s closing price, Truist Financial’s dividend yield currently stands at 6.5%. In the past three months, shares of TFC have declined 5%.
Based on the last day’s closing price, U.S Bancorp’s dividend yield currently stands at 5.7%. In the past three months, shares of USB have declined 5.8%.
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Is Bank of Hawaii (BOH) Worth a Look on 6.68% Dividend Yield?
Bank of Hawaii Corporation (BOH - Free Report) is a solid dividend-yielding stock that investors may keep on the radar amid the current turmoil in the banking industry and looming recession fears in the near term.
Headquartered at Honolulu, HI, Bank of Hawaii Corporation is a bank holding company, which provides a broad array of products and services in Hawaii, Guam and other Pacific Islands.
BOH has been paying its quarterly dividend on a regular basis and raising it occasionally. The last hike of 4.5% to 70 cents per share was announced in July 2021. In the past five years, it increased dividends four times, with an annualized dividend growth rate of 2.90%.
Considering last day’s closing price of $41.92 per share, the company’s current dividend yield is 6.68%. This is impressive compared with the industry’s average of 3.2%, attracting investors as it represents a steady income stream.
Bank of Hawaii Corporation Dividend Yield (TTM)
Bank of Hawaii Corporation dividend-yield-ttm | Bank of Hawaii Corporation Quote
Is the Bank of Hawaii stock worth a look to earn a high dividend yield? Let’s check the company's financials to understand the risks and rewards.
Apart from regular quarterly dividend payouts, BOH has a steady share repurchase program in place. In January 2023, the company's board of directors announced an additional share buyback authorization of $100 million. As of Mar 31, 2023, $126 million remained available under the program.
As of Mar 31, 2023, the company’s securities sold under agreements to repurchase and other debt, aggregated to $1.24 billion, up sequentially. Nonetheless, the total liquidity stood at $10.1 billion as of the same date. The high quality of the asset base provides the company with ample liquidity access. Given substantial liquidity lines, we believe that Bank of Hawaii will continue to enhance shareholder value through its capital deployment activities.
Organic growth remains a key strength at BOH. The company’s deposit base saw a five-year (2018-2022) compound annual growth rate (CAGR) of 8.2%, whereas net loans and leases witnessed a CAGR of 6.9% during the same time frame. Nonetheless, its diversified and long-duration deposit base, along with diversified and lower-risk loan assets, positions the company to maintain a robust balance sheet.
Going forward, strong deposit balances will also help the company generate higher loans and pursue other general business purposes. We anticipate total deposits, and net loans and leases to increase 4.8% and 4.4%, respectively, in 2023.
Also, revenues witnessed a CAGR of 1.7% over the last five years (2017-2022). The uptrend in revenues continued in the first quarter of 2023. Revenue growth was supported by a rise in NII, backed by rising rates. With the Federal Reserve expected to keep the interest rates high in the near term, the same is likely to support Bank of Hawaii’s NII and net interest margin (NIM) growth. We project NII to decline in 2023 but rebound at 0.1% and 2.4% in 2024 and 2025, respectively.
Despite the near-term headwinds, including rising expenses and declining fee income, BOH stock is fundamentally solid.
In the past three months, shares of this Zacks Rank #3 (Hold) company have declined 18.9% compared with the industry's decline of 6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
Therefore, income investors should keep this stock on their radar as this will help generate robust returns over time.
Bank Stocks With Solid Dividends
Banking stocks like Truist Financial Corporation (TFC - Free Report) and U.S Bancorp (USB - Free Report) are worth a look as these, too, have robust dividend yields.
Considering the last day’s closing price, Truist Financial’s dividend yield currently stands at 6.5%. In the past three months, shares of TFC have declined 5%.
Based on the last day’s closing price, U.S Bancorp’s dividend yield currently stands at 5.7%. In the past three months, shares of USB have declined 5.8%.