Is First Hawaiian’s (FHB) Rising Net Interest Income Shaping a New Investment Narrative?

• First Hawaiian, Inc. recently reported third quarter results showing net interest income of US$169.33 million and net income of US$73.84 million, as well as continued share buybacks and the affirmation of a US$0.26 per share dividend.
• A key insight is that both net interest income and net income increased compared to the same period last year, underlining improved financial performance amidst ongoing operational initiatives.
• We'll consider how First Hawaiian's higher net interest income this quarter could influence the company's outlook and investment narrative going forward.

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First Hawaiian Investment Narrative Recap

To be a shareholder in First Hawaiian right now, you need to believe in the resilience of its deposit base and the bank’s ability to generate steady, growing earnings from its loyal customer network and Hawaii-focused franchise. The most recent quarterly results reinforce the importance of net interest income as the primary short-term catalyst supporting earnings growth, but they do not materially address the risk of ongoing deposit migration to digital competitors or further loan portfolio stagnation.

Among the recent announcements, the company’s latest share buyback update stands out as the most relevant, with nearly 1 million shares repurchased in the third quarter for US$24 million. This move may enhance per-share metrics and signals management’s ongoing commitment to supporting shareholder value, but it does not directly offset the broader risks posed by changing deposit trends or slow loan growth.

On the other hand, investors should be aware that rising competition for deposits remains a growing area of concern if...

Read the full narrative on First Hawaiian (it's free!)

First Hawaiian's narrative projects $952.3 million in revenue and $263.9 million in earnings by 2028. This requires 5.8% yearly revenue growth and a $17.4 million earnings increase from $246.5 million today.

Uncover how First Hawaiian's forecasts yield a $26.89 fair value, a 10% upside to its current price.

Exploring Other Perspectives

Fair value estimates from two Simply Wall St Community members range widely between US$26.89 and US$51.10. While many see strong fundamental support from core earnings, shifting customer preferences toward digital banking could still weigh on First Hawaiian’s future returns, so compare different viewpoints before making a decision.

Explore 2 other fair value estimates on First Hawaiian - why the stock might be worth just $26.89!

Build Your Own First Hawaiian Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your First Hawaiian research is our analysis highlighting 3 key rewards that could impact your investment decision.
• Our free First Hawaiian research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate First Hawaiian's overall financial health at a glance.

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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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