NasdaqGS:HTBK

Stock Analysis Report

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Market Cap

US$651.5m

Last Updated

2021/07/31 22:07 UTC

Data Sources

Company Financials +

Executive Summary

Heritage Commerce Corp operates as the bank holding company for Heritage Bank of Commerce that provides various commercial and personal banking services to residents and the business/professional community in California. More Details


Snowflake Analysis

Flawless balance sheet with solid track record and pays a dividend.


Similar Companies

Share Price & News

How has Heritage Commerce's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HTBK is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: HTBK's weekly volatility (4%) has been stable over the past year.


Market Performance


7 Day Return

-1.0%

HTBK

0.9%

US Banks

-0.5%

US Market


1 Year Return

59.9%

HTBK

59.1%

US Banks

35.9%

US Market

Return vs Industry: HTBK matched the US Banks industry which returned 59.1% over the past year.

Return vs Market: HTBK exceeded the US Market which returned 35.9% over the past year.


Shareholder returns

HTBKIndustryMarket
7 Day-1.0%0.9%-0.5%
30 Day-3.8%-3.5%0.3%
90 Day-10.2%-4.4%3.1%
1 Year70.2%59.9%63.5%59.1%38.0%35.9%
3 Year-16.4%-27.6%17.3%7.2%62.9%52.7%
5 Year19.8%-1.3%89.6%65.9%121.7%97.3%

Long-Term Price Volatility Vs. Market

How volatile is Heritage Commerce's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Heritage Commerce undervalued compared to its fair value and its price relative to the market?

30.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HTBK ($10.84) is trading below our estimate of fair value ($15.66)

Significantly Below Fair Value: HTBK is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: HTBK is poor value based on its PE Ratio (15.1x) compared to the US Banks industry average (10.8x).

PE vs Market: HTBK is good value based on its PE Ratio (15.1x) compared to the US market (18x).


Price to Earnings Growth Ratio

PEG Ratio: HTBK is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: HTBK's PB Ratio (1.1x) is in line with the US Banks industry average.


Future Growth

How is Heritage Commerce forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

8.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HTBK's forecast earnings growth (8.5% per year) is above the savings rate (2%).

Earnings vs Market: HTBK's earnings (8.5% per year) are forecast to grow slower than the US market (14.9% per year).

High Growth Earnings: HTBK's earnings are forecast to grow, but not significantly.

Revenue vs Market: HTBK's revenue (5.6% per year) is forecast to grow slower than the US market (9.2% per year).

High Growth Revenue: HTBK's revenue (5.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HTBK's Return on Equity is forecast to be low in 3 years time (8.2%).


Past Performance

How has Heritage Commerce performed over the past 5 years?

13.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HTBK has high quality earnings.

Growing Profit Margin: HTBK's current net profit margins (28.5%) are higher than last year (21.5%).


Past Earnings Growth Analysis

Earnings Trend: HTBK's earnings have grown by 13% per year over the past 5 years.

Accelerating Growth: HTBK's earnings growth over the past year (45.5%) exceeds its 5-year average (13% per year).

Earnings vs Industry: HTBK earnings growth over the past year (45.5%) exceeded the Banks industry 34.3%.


Return on Equity

High ROE: HTBK's Return on Equity (7.3%) is considered low.


Financial Health

How is Heritage Commerce's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet


Financial Institutions Analysis

Asset Level: HTBK's Assets to Equity ratio (8.7x) is low.

Allowance for Bad Loans: HTBK has a sufficient allowance for bad loans (711%).

Low Risk Liabilities: 97% of HTBK's liabilities are made up of primarily low risk sources of funding.

Loan Level: HTBK has an appropriate level of Loans to Assets ratio (55%).

Low Risk Deposits: HTBK's Loans to Deposits ratio (64%) is appropriate.

Level of Bad Loans: HTBK has an appropriate level of bad loans (0.2%).


Dividend

What is Heritage Commerce current dividend yield, its reliability and sustainability?

4.80%

Current Dividend Yield


Upcoming Dividend Payment

TodayAug 01 2021Ex Dividend DateAug 11 2021Dividend Pay DateAug 26 202115 days from Ex DividendBuy in the next 10 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: HTBK's dividend (4.8%) is higher than the bottom 25% of dividend payers in the US market (1.31%).

High Dividend: HTBK's dividend (4.8%) is in the top 25% of dividend payers in the US market (3.54%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, HTBK has been paying a dividend for less than 10 years.

Growing Dividend: HTBK's dividend payments have increased, but the company has only paid a dividend for 8 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (72.6%), HTBK's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HTBK's dividends in 3 years are forecast to be covered by earnings (62.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.9yrs

Average management tenure


CEO

Walt Kaczmarek (69 yo)

0.33

Tenure

US$80,787

Compensation

Mr. Walter T. Kaczmarek, also known as Walt, serves as the President and Chief Executive Officer of Heritage Bank of Commerce since March 12, 2021. He has been a Heritage Bank of Commerce Director since 20...


CEO Compensation Analysis

Compensation vs Market: Walt's total compensation ($USD80.79K) is below average for companies of similar size in the US market ($USD2.42M).

Compensation vs Earnings: Walt's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: HTBK's management team is seasoned and experienced (5.9 years average tenure).


Board Members

Experienced Board: HTBK's board of directors are considered experienced (8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: HTBK insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Heritage Commerce Corp's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Heritage Commerce Corp
  • Ticker: HTBK
  • Exchange: NasdaqGS
  • Founded: 1994
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$651.515m
  • Shares outstanding: 60.10m
  • Website: https://www.heritagecommercecorp.com

Number of Employees


Location

  • Heritage Commerce Corp
  • 224 Airport Parkway
  • San Jose
  • California
  • 95110
  • United States

Listings


Biography

Heritage Commerce Corp operates as the bank holding company for Heritage Bank of Commerce that provides various commercial and personal banking services to residents and the business/professional community...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/07/31 22:07
End of Day Share Price2021/07/30 00:00
Earnings2021/06/30
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.