Hope Bancorp (NASDAQ:HOPE) & First Hawaiian (NASDAQ:FHB) Critical Contrast

Hope Bancorp (NASDAQ:HOPE) and First Hawaiian (NASDAQ:FHB) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Profitability

This table compares Hope Bancorp and First Hawaiian’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hope Bancorp	4.89%	4.70%	0.58%
First Hawaiian	22.60%	9.68%	1.08%

Valuation & Earnings

This table compares Hope Bancorp and First Hawaiian”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hope Bancorp	$470.12 million	2.69	$99.63 million	$0.39	25.33
First Hawaiian	$810.12 million	3.61	$230.13 million	$2.05	11.53

First Hawaiian has higher revenue and earnings than Hope Bancorp. First Hawaiian is trading at a lower price-to-earnings ratio than Hope Bancorp, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Hope Bancorp has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, First Hawaiian has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500.

Dividends

Hope Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 5.7%. First Hawaiian pays an annual dividend of $1.04 per share and has a dividend yield of 4.4%. Hope Bancorp pays out 143.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First Hawaiian pays out 50.7% of its earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of recent recommendations for Hope Bancorp and First Hawaiian, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hope Bancorp	0	3	1	0	2.25
First Hawaiian	3	7	0	1	1.91

Hope Bancorp presently has a consensus target price of $13.25, indicating a potential upside of 34.11%. First Hawaiian has a consensus target price of $27.75, indicating a potential upside of 17.38%. Given Hope Bancorp’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Hope Bancorp is more favorable than First Hawaiian.

Institutional & Insider Ownership

84.0% of Hope Bancorp shares are held by institutional investors. Comparatively, 97.6% of First Hawaiian shares are held by institutional investors. 5.2% of Hope Bancorp shares are held by insiders. Comparatively, 0.6% of First Hawaiian shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

First Hawaiian beats Hope Bancorp on 10 of the 17 factors compared between the two stocks.

About Hope Bancorp

Hope Bancorp, Inc. operates as the bank holding company for Bank of Hope that provides retail and commercial banking services for businesses and individuals in the United States. It accepts personal and business checking, money market, savings, time deposit, and individual retirement accounts. The company also offers loans comprising commercial and industrial loans to businesses for various purposes, such as working capital, purchasing inventory, debt refinancing, business acquisitions, international trade finance, other business-related financing, and loans syndication services; commercial real estate loans; residential mortgage loans; small business administration loans; and consumer loans, such as single-family mortgage, home equity, automobile, credit card, and personal loans. In addition, it provides internet banking and bill-pay, remote deposit capture, lock box, and ACH origination services; treasury management services; foreign currency exchange transactions; interest rate contracts and wealth management services; automated teller machine services; and engages in investment activities. Hope Bancorp, Inc. was founded in 1986 and is headquartered in Los Angeles, California.

About First Hawaiian

First Hawaiian, Inc. operates as a bank holding company for First Hawaiian Bank that provides a range of banking products and services to consumer and commercial customers in the United States. It operates in three segments: Retail Banking, Commercial Banking, and Treasury and Other. The company offers various deposit products, including checking, savings, and time deposit accounts, and other deposit accounts. It also provides residential and commercial mortgage loans, home equity lines of credit and loans, automobile loans and leases, secured and unsecured lines of credit, installment loans, small business loans and leases, and construction lending, as well as commercial lease and auto dealer financing. In addition, the company offers wealth management, personal installment, individual investment and financial planning, insurance protection, trust and estate, private banking, investment management, retirement planning, and merchant processing services, as well as consumer and commercial credit cards. The company was formerly known as BancWest Corporation and changed its name to First Hawaiian, Inc. in April 2016. First Hawaiian, Inc. was founded in 1858 and is headquartered in Honolulu, Hawaii.