BOH Stock Forecast & Price Target

Bank of Hawaii has demonstrated solid financial performance, with net interest income (NII) increasing by 5.4% quarter-over-quarter to reach $136.7 million, slightly exceeding prior forecasts. Noninterest income also showed positive momentum, rising by 2.6% to $46 million, indicating diversified revenue growth beyond traditional banking operations. Additionally, a notable 5.4% increase in deposits further reinforces the institution's strong market position, contributing to a favorable outlook for continued financial health and stability.

Bank of Hawaii Corp recently experienced a -3.2% contraction in held-for-investment (HFI) loans, significantly missing its growth estimate of +0.8%, which indicates a troubling trend in loan demand. This decline, combined with a net interest income miss of $131.3 million due to a smaller-than-expected balance sheet and a lower net interest margin, underscores challenges in revenue generation. Furthermore, a forecasted 2%-3% increase in expenses for FY25 hints at potential profitability pressures, particularly in an environment where declining U.S. Treasury rates could further erode yields on reinvested cash flows from loans.