NYSE:OFG

Stock Analysis Report

Executive Summary

OFG Bancorp, a financial holding company, provides various banking and financial services.

Rewards

Trading at 44.5% below its fair value

Earnings are forecast to grow 33.45% per year

Earnings have grown 19.5% per year over the past 5 years

Risk Analysis

Shareholders have been diluted in the past year



Snowflake Analysis

Flawless balance sheet and undervalued.

Share Price & News

How has OFG Bancorp's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: OFG has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.9%

OFG

0.9%

US Banks

0.03%

US Market


1 Year Return

25.9%

OFG

19.0%

US Banks

18.6%

US Market

Return vs Industry: OFG exceeded the US Banks industry which returned 19% over the past year.

Return vs Market: OFG exceeded the US Market which returned 18.6% over the past year.


Shareholder returns

OFGIndustryMarket
7 Day0.9%0.9%0.03%
30 Day1.7%1.1%1.7%
90 Day5.5%15.5%5.7%
1 Year27.7%25.9%22.5%19.0%21.1%18.6%
3 Year62.0%52.9%30.1%21.0%45.6%36.2%
5 Year54.2%37.0%77.5%57.8%71.1%52.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is OFG Bancorp undervalued compared to its fair value and its price relative to the market?

44.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: OFG ($21.64) is trading below our estimate of fair value ($39.01)

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


Price To Earnings Ratio

PE vs Industry: OFG is poor value based on its PE Ratio (15.1x) compared to the Banks industry average (12.7x).

PE vs Market: OFG is good value based on its PE Ratio (15.1x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: OFG is good value based on its PEG Ratio (0.5x)


Price to Book Ratio

PB vs Industry: OFG is good value based on its PB Ratio (1.2x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is OFG Bancorp forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

33.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: OFG's forecast earnings growth (33.5% per year) is above the savings rate (1.7%).

Earnings vs Market: OFG's earnings (33.5% per year) are forecast to grow faster than the US market (14.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: OFG's revenue (28.7% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: OFG's revenue (28.7% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: OFG's Return on Equity is forecast to be low in 3 years time (11.7%).


Next Steps

Past Performance

How has OFG Bancorp performed over the past 5 years?

19.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: OFG has high quality earnings.

Growing Profit Margin: OFG's current net profit margins (22.6%) are higher than last year (19.8%).


Past Earnings Growth Analysis

Earnings Trend: OFG's earnings have grown by 19.5% per year over the past 5 years.

Accelerating Growth: OFG's earnings growth over the past year (16.2%) is below its 5-year average (19.5% per year).

Earnings vs Industry: OFG earnings growth over the past year (16.2%) underperformed the Banks industry 27.1%.


Return on Equity

High ROE: OFG's Return on Equity (7.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is OFG Bancorp'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

Inventory Level: OFG has a low level of unsold assets or inventory.

Debt Coverage by Assets: OFG's debt is covered by short term assets (assets are 3.7x debt).


Financial Institutions Analysis

Asset Level: OFG's level of assets compared to its equity is low.

Allowance for Bad Loans: OFG has a sufficient allowance for bad loans.

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

Loan Level: OFG has an acceptable proportion of non-loan assets held.

Low Risk Deposits: OFG's loans are broadly funded by customer deposits.

Level of Bad Loans: OFG has an appropriate level of bad loans (1.7%)


Next Steps

Dividend

What is OFG Bancorp's current dividend yield, its reliability and sustainability?

1.29%

Current Dividend Yield


Upcoming Dividend Payment

Purchase OFG Bancorp before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company1.3%marketbottom25%1.4%markettop25%3.7%industryaverage2.8%forecastin3Years1.4%

Current dividend yield vs market & industry

Notable Dividend: OFG's dividend (1.29%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.42%).

High Dividend: OFG's dividend (1.29%) is low compared to the top 25% of dividend payers in the US market (3.7%).


Stability and Growth of Payments

Stable Dividend: OFG's dividend payments have been volatile in the past 10 years.

Growing Dividend: OFG's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (19.5%), OFG's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: OFG's dividends in 3 years are forecast to be thoroughly covered by earnings (11.9% payout ratio).


Next Steps

Management

What is the CEO of OFG Bancorp's salary, the management and board of directors tenure and is there insider trading?

11.9yrs

Average management tenure


CEO

José Fernández (55yo)

15.9yrs

Tenure

US$2,800,477

Compensation

Mr. José Rafael Fernández, also known as Jos, has been the Chief Executive Officer and President of OFG Bancorp since 2004. Mr. Fernández has been President of Oriental Financial Services Corp., a subsidia ...


CEO Compensation Analysis

Compensation vs Market: José's total compensation ($USD2.80M) is about average for companies of similar size in the US market ($USD2.63M).

Compensation vs Earnings: José's compensation has increased by more than 20% in the past year.


Management Age and Tenure

11.9yrs

Average Tenure

55yo

Average Age

Experienced Management: OFG's management team is seasoned and experienced (11.9 years average tenure).


Board Age and Tenure

5.6yrs

Average Tenure

62yo

Average Age

Experienced Board: OFG's board of directors are considered experienced (5.6 years average tenure).


Insider Trading

Insider Buying: OFG insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$20,39922 Nov 19
Wendco of Puerto Rico, Inc.
EntityCompany
Shares1,000
Max PriceUS$20.40
BuyUS$13,25722 Nov 19
Jorge Colón Gerena
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares650
Max PriceUS$20.40
BuyUS$808,44822 Nov 19
Edwin Hernández
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares40,000
Max PriceUS$20.45
BuyUS$46,44028 Dec 18
Julian Inclán
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares3,000
Max PriceUS$15.48
BuyUS$45,52821 Dec 18
José Fernández
EntityIndividual
Role
Chief Executive Officer
Vice Chairman
Shares3,000
Max PriceUS$15.18

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 15.8%.


Management Team

  • José Fernández (55yo)

    Vice Chairman

    • Tenure: 15.9yrs
    • Compensation: US$2.80m
  • Luis Alejandro (58yo)

    Senior Vice President and Senior Vice President of Branch Administration

    • Tenure: 18.4yrs
  • Ganesh Kumar (55yo)

    Senior EVP

    • Tenure: 2.8yrs
    • Compensation: US$1.86m
  • Cesar Ortiz (44yo)

    Senior VP and Director of Commercial Credit & Operations

    • Tenure: 12.5yrs
    • Compensation: US$396.47k
  • Ramón Rosado-Linera (55yo)

    Senior VP & Director of the U.S. Loan Program

    • Tenure: 0yrs
    • Compensation: US$387.30k
  • Carlos Souffront

    Executive VP

    • Tenure: 11.9yrs
  • Rafael Cruz (63yo)

    Senior VP and Chief Risk & Compliance Officer

    • Tenure: 9.9yrs
    • Compensation: US$343.04k
  • Maritza Arizmendi Díaz (51yo)

    Executive VP & CFO

    • Tenure: 2.8yrs
    • Compensation: US$622.09k
  • Jennifer Nazario

    Senior Vice President of Human Resources

    • Tenure: 0yrs
  • Steven Anreder

    Investor Relations Contact

    • Tenure: 0yrs

Board Members

  • José Fernández (55yo)

    Vice Chairman

    • Tenure: 15.9yrs
    • Compensation: US$2.80m
  • Julian Inclán (71yo)

    Independent Chairman of the Board

    • Tenure: 7.4yrs
    • Compensation: US$165.56k
  • Sue Harnett (62yo)

    Director

    • Tenure: 0.4yrs
  • Juan Aguayo (55yo)

    Independent Director

    • Tenure: 15.2yrs
    • Compensation: US$88.18k
  • Pedro Morazzani Ferrer (66yo)

    Independent Director

    • Tenure: 13.1yrs
    • Compensation: US$107.88k
  • Edwin Hernández (65yo)

    Independent Director

    • Tenure: 1.2yrs
    • Compensation: US$11.00k
  • Christa Steele (44yo)

    Director

    • Tenure: 0.2yrs
  • Jorge Colón Gerena (52yo)

    Independent Director

    • Tenure: 5.6yrs
    • Compensation: US$77.71k
  • Néstor de Jesús (67yo)

    Independent Director

    • Tenure: 3.9yrs
    • Compensation: US$77.94k

Company Information

OFG Bancorp's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: OFG Bancorp
  • Ticker: OFG
  • Exchange: NYSE
  • Founded: 1964
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$1.074b
  • Shares outstanding: 51.35m
  • Website: https://www.ofgbancorp.com

Number of Employees


Location

  • OFG Bancorp
  • 254 Muñoz Rivera Avenue
  • San Juan
  • Puerto Rico
  • 918
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
OFGNYSE (New York Stock Exchange)YesCommon StockUSUSDJun 1992
OFPDB (Deutsche Boerse AG)YesCommon StockDEEURJun 1992
OFG.PRDNYSE (New York Stock Exchange)PERP PFD-DUSUSDNov 2012
OFG.PRBNYSE (New York Stock Exchange)7% PFD SER BUSUSDApr 2013

Biography

OFG Bancorp, a financial holding company, provides various banking and financial services. It operates in three segments: Banking, Wealth Management, and Treasury. The company offers checking and savings a ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/07 23:42
End of Day Share Price2019/12/06 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


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.