East West Bancorp (EWBC): Assessing Valuation Following Strong Q2 2025 Results and Continued Growth Momentum

East West Bancorp (EWBC) has caught investors’ attention following its latest investor update, where the bank showcased strong financial results for the second quarter of 2025. Growth was propelled by both commercial and residential mortgage loans, and the company emphasized a 2% rise in average loans and deposits from the prior quarter. This consistent execution on its core strategies, especially around diversification and deposit management, has kept East West Bancorp at the forefront of the industry and secured recognition as a top performer for three years in a row. Over the past year, East West Bancorp’s stock has delivered a 38% return, which stands well above what many regional lenders have achieved in recent periods. The momentum has been building this year as well, with an impressive 14% year-to-date gain and a 13% increase in the past three months. While recent quarters have seen solid revenue and net income growth, the company’s approach to balancing risk and opportunity remains a major talking point. All this naturally raises the big question: after such a strong run, is East West Bancorp’s current share price reflecting all of its growth potential or is there still an opportunity for investors who believe the story is far from over?

Most Popular Narrative: 9.4% Undervalued

The most widely followed narrative views East West Bancorp as undervalued by nearly 10%, largely driven by sustained growth expectations and a robust strategic direction.

Sustained investments in digital banking, automation, and technology in areas such as mobile, cybersecurity, and operational efficiency allow for scalable growth and improve the efficiency ratio. This supports higher net margins and long-term cost containment.

Want to know the playbook that is powering this optimistic view? The narrative hints at bold growth assumptions and a profit outlook that implies big upside potential. What key financial forecasts are putting this premium price tag within reach? If you are curious about the specifics behind these projections and what it all could mean for future returns, keep reading for a closer look at what underpins this bullish consensus.

Result: Fair Value of $118.69 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, heightened commercial real estate exposure and rising compliance costs could dampen East West Bancorp’s growth and challenge the market’s optimistic outlook.

Find out about the key risks to this East West Bancorp narrative.

Another View: How Does Value Stack Up?

Looking from a different angle, East West Bancorp is actually trading at a higher price compared to the industry’s typical price-to-earnings ratio. Could this mean the share price has raced ahead of fundamentals, or is there a premium for quality here?

See what the numbers say about this price — find out in our valuation breakdown.

Stay updated when valuation signals shift by adding East West Bancorp to your watchlist or portfolio. Alternatively, explore our screener to discover other companies that fit your criteria.

Build Your Own East West Bancorp Narrative

If you see things differently or want to draw your own conclusions, you can easily build your own perspective in just a few minutes. Do it your way.

A great starting point for your East West Bancorp research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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