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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Hope Bancorp, Inc. (XNAS:HOPE) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
HOPE
Name:
HOPE BANCORP, INC. (XNAS:HOPE)
Sector:
181.52M
Industry:
Banks�Regional
CEO:
Mr. Kevin Kim
Total Employees:
1,476
Our Technological Advancement Rating
Our Rating:
A
Technological advancement compared to industry is 73.65% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF HOPE BANCORP, INC.(HOPE) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND BANKS�REGIONAL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
14.28
One Month Price Target:
$14.38
Six Month Price Target :
$14.87
Likely Price in One Year's Time:
Ticker:
$15.47
Likely Trading Range Today Under (Normal Volatility)
$14.22
Price Upper limit ($) :
$14.35
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$13.46
This week:
$12.44
This month :
$10.6
Other Primary facts
Market Cap:
1.66B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
119.48M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
14.5%
-13.58%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$18.10
$16.35
$10.46
$12.21
Medium risk (<10%) entry points
Buy Call
Sell Call
$15.79
Buy Put:
Sell Put:
$15.41
$12.77
$13.15
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
HOPE
Sharpe Ratio:
0.87%
Comparison:
HOPE, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -29.46% lower than the industry
& is -61.98% lower than the market/S&P 500 average
Average Returns/Yield of
HOPE
Daily returns:
0.03%
Weekly returns:
0.17%
Monthly returns:
0.67%
Yearly returns:
10.91%
Comparison of returns:
Average annual returns/yield (last 3 years) is -26.69% below industry average
Classification:
HOPE, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.37
Statistical test of Returns:
HOPE has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.83%
Weekly Volatility:
6.32%
Monthly Volatility:
12.63%
Yearly Volatility:
43.77%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.66%
Volatility in last five trading days has been -76.81% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.77%
Weekly VaR:
-12.90%
Monthly VaR:
-25.80%
How Much Can the price of
HOPE
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-22%
Worst case (decline):
-89.37%
This translates to price declining to:
$11.08
This translates to price declining to:
$1.52
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
HOPE is a 82.08% riskier investment compared to the market/S&P 500 & is 55.99% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -1.10% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
HOPE
Beta in relation to market/S&P 500--1.23
Expected beta in 1 year's time:
0.763
Expected beta in 3 year's time:
1.079
Unlevered (debt free) Beta:
0.872
Beta in relation to Nasdaq (XNAS):
0.499
Beta in relation to all global stocks::
0.74
Beta Comparison & Analysis
Beta of competitors/peers::
0.966
Beta is 27.87% higher than peers
Average Industry Beta:
0.964
Beta is 28.15% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
6.61%
Sustainable growth rate is -27.58% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.036
Alpha is -411.13% below industry average alpha yield
Alpha is -230% below the market average
Analysis of Cost of Capital of
HOPE
Equity cost of capital:
0.116
Equity cost of capital is 19.06% above industry mean WACC
Unlevered (without debt) cost of capital:
8.20%
Before-tax cost of debt:
4.33%
After-tax cost of debt:
3.42%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.42%
WACC is -3.55% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$4.75
Revenue growth rate per share of (3Y):
0.84
Annual revenue growth rate is -62.92% below industry average
EPS:
$1.81
Expected Annual growth rate of EPS (3Y):
7.13%
Expected future EPS growth rate is -40.67% lower than the Banks�Regional industry
Free cash flow (FCF) per share:
$3.66
Balance sheet equity growth per share: 5.08%
Equity growth rate per share is -86.88% lower than the industry
Debt per share
$9.62
EBITDA per share
$3.14
Valuation Analysis Today of
HOPE
P/E Ratio:
7.88
P/E Ratio of Competitors/Peers:
12.13
P/E ratio is -34.99% lower than main peers & is -36.47% lower than the industry
Stock price/value with industry average P/E ratio: $22.46
HOPE is -36.42% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $16.51
Present value of the expected future dividends only: $4.82
P/S (Price to Sales ratio):
3
Price to sales ratio is -29.77% below the industry mean
P/B (Price to book value ratio):
0.84
Price to free cash flow: 3.90
Price to free cash flow ratio is -66.00% lower than the industry
Net income growth rate (3Y):
18.28%
Net income growth rate is -66.81% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 7.59%
Dividend yeild: 3.92%
Previous Dividend: $0.14
Previous adjusted dividend: $0.14
Previous Dividend: $0.56
-
-
Average dividend payment (long-term): $0.14
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 08/10/2022
Expected next dividend record date: 27/07/2022
Expected next dividend declaration date: 18/07/2022
Previous dividend payment date: 05/12/2022
Previous dividend record date: 28/04/2022
Previous dividend declaration date: 18/04/2022
Dividend History:
2022-04-27--$0.14
2021-11-03--$0.14
2021-05-06--$0.14
2022-02-02--$0.14
2021-07-29--$0.14
2021-02-04--$0.14
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
56.29%
Net debt to equity ratio:
41.98%
Debt to assets ratio:
6.45%
Net debt to assets ratio:
4.81%
Debt-to-asset ratio is -96.12% below industry average
Ability to repay debt:
Interest coverage ratio:
7.55
Interest coverage ratio is 810.42% more than industry average
Looking forward:
Debt growth rate:
1.77%
Annual debt growth is 458% higher than industry average debt growth rate
Debt repayment rate in last quarter: 70.70%
Analysis of Key Statistics
Correlation of price movement with the market:
0.486
Statistical significance of correlation:
HOPE has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.501
Stock price is -2.94% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.501
Correlation of price movement with Nasdaq (^IXIC):
0.045
Covariance of price movement with the market:
0.074
Kurtosis
4.138
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.29
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
HOPE
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
-
Effective Tax Rate:
26.03%
Effective tax rate is 20.80% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
10.86%
Return on equity (ROE) is -8.98% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.24%
Return on assets (ROA) is -45.98% lower than the industry
Financial Leverage:
1.1x
Current Ratio:
0
-
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 4.7 years
Stock based compensation to net income ratio:
1.17%
In-depth Efficiency Analysis
Revenue generated per employee:
384.9K
Each employee generates 1% more revenue than industry average revenue per employee
EBITDA generated per employee:
254.3K
Each employee generates 13% more EBITDA than industry average revenue per employee
Profit generated per employee:
150.2K
Each employee generates 6% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
123.0K
Each employee generates 48% more free cash flow than industry average revenue per employee
Assets/Capital per employee
2.1M
Each employee generates 48% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
HOPE
ENTERPRISE FINANCIAL SERVICES CORP (XNAS:EFSC)
Pathward Financial, Inc. (XNAS:CASH)
GCM Grosvenor Inc. (XNAS:GCMG)
NORTHWEST BANCSHARES, INC. (XNAS:NWBI)
INSTIL BIO, INC. (XNAS:TIL)
NMI HOLDINGS, INC. (XNAS:NMIH)
VERITEX HOLDINGS, INC. (XNAS:VBTX)
NBT BANCORP INC. (XNAS:NBTB)
LAKELAND FINANCIAL CORPORATION (XNAS:LKFN)
Current Analyst Ratings
Strong buy�4%
Buy�0%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
568.05M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
-
-
-
197.16M
205.88M
8.72M
-
-
573.11M
49.74M
26.00M
375.35M
-
221.62M
299.61M
77.99M
221.62M
Statement of Cash Flow
Date:
Period:
-
Differed Income Tax :
65.00K
Stock Based Compensation :
2.60M
Change in Working Capital :
57.88M
Accounts Receivables:
3.69M
Other Working Capital:
-
Other Non-Cash Items:
62.38M
Net Cash Provided by Operating Activities:
183.66M
Investments in PP&E:
- 2146.00K
Net Acquisitions:
-
Purchases of Investments:
- 85843.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
292.00M
2.49B
2.78B
37.95M
-
-
-
95.85M
464.45M
7.18M
2.61B
-
-
3.17B
20.98B
17.80B
4.83M
-
-
-
-
-
1.15B
-
1.15B
16.91B
15.76B
137.00K
976.48M
- 108165.0K
1.17B
March 31, 2022 at 6:00:00 AM
-
2.04B
17.80B
5.10B
1.15B
856.9M
114.88M
- 174614.00K
- 147724.00K
- 2772000.00K
-
-
- 16816.00K
2.72B
- 71831.00K
-
- 35893.00K
280.37M
316.27M
183.66M
- 2146.00K
181.52M
Our Proprietary Portfolio Rating
Our Rating:
A
Price Forecast/Expected Price in Next 5 Years of
HOPE
2023
2024
2025
2026
2027
$19.37
$20.98
$22.72
$24.60
$26.64