Hot Stock in the Spotlight: First Hawaiian, Inc. (NASDAQ: FHB)

On Wednesday, Shares of First Hawaiian, Inc. (NASDAQ: FHB) showed the bearish trend with a lower momentum of -0.46% and ended its trading session at $27.85. The company traded total volume of 2,022 shares as contrast to its average volume of 335.86K shares. The company has a market value of $3.90B and about 139.56M shares outstanding. During the 52-week trading session, the minimum price at which share price traded was registered at $26.30 and reached the max level of $32.40.

First Hawaiian, Inc. (FHB) recently stated financial results for its fourth quarter and full year ended December 31, 2017.

Earnings Highlights:

Net income for the quarter ended December 31, 2017 was $11.70M, or $0.08 per diluted share, contrast to $58.40M, or $0.42 per diluted share, for the quarter ended September 30, 2017, and $56.60M, or $0.41 per diluted share, for the quarter ended December 31, 2016.  Core net income for the quarter ended December 31, 2017 was $59.20M, or $0.42 per diluted share, contrast to $57.00M, or $0.41 per diluted share, for the quarter ended September 30, 2017, and $56.00M, or $0.40 per diluted share, for the quarter ended December 31, 2016. Net income for the full year 2017 was $183.70M, or $1.32 per diluted share, contrast to $230.20M, or $1.65 per diluted share, for the full year 2016.  Core net income for the full year 2017 was $230.40M or $1.65 per diluted share, contrast to $217.10M, or $1.56 per diluted share for the full year 2016.

Net interest income for the quarter ended December 31, 2017 was $134.90M, a boost of $1.60M contrast to $133.30M for the quarter ended September 30, 2017, and a boost of $3.60M contrast to $131.30M for the quarter ended December 31, 2016.  The increase in net interest income contrast to the third quarter of 2017 was because of higher average balances of loans and investment securities and higher yields on investment securities, partially offset by higher rates on deposits. The increase in net interest income contrast to the fourth quarter of 2016 was because of higher average balances of loans and higher yields on loans, interest-bearing deposits in other banks, and investment securities, partially offset by higher rates on deposits.  Net interest income for the full year 2017 was $528.80M contrast to $491.70M for 2016.  The increase in net interest income was mainly attributable to higher average balances and yields on loans and investment securities, partially offset by higher rates on deposits.

Results for the quarter ended December 31, 2017 included a provision for credit losses of $5.10M contrast to $4.50M in the quarter ended September 30, 2017 and $3.90M in the quarter ended December 31, 2016.  The provision for credit losses for the full year of 2017 was $18.50M, contrast to $8.60M in 2016.

Noninterest income was $54.30M in the quarter ended December 31, 2017, a boost of $4.60M contrast to noninterest income of $49.70M in the quarter ended September 30, 2017 and a boost of $3.30M contrast to noninterest income of $51.00M in the quarter ended December 31, 2016.    The increase in noninterest income contrast to the third quarter was because of $6.20M higher other noninterest income, mainly because of a $4.30M gain on sale of a bank property, contrast to a $2.70M gain on sale of a bank property in the third quarter, and $3.70M related to intercompany taxes.   The increase in noninterest income contrast to the fourth quarter of 2016 was mainly because of $5.10M higher other noninterest income, mainly offset by $1.50M lower investment securities gains.  Noninterest income for full year 2017 was $205.60M contrast to $226.00M for 2016.  The $20.40M lower noninterest income in 2017 contrast to 2016 was mainly because of $27.3 lower investment securities gains; partially offset by higher other noninterest income.  Investment securities gains in 2016 included a gain of $22.70M from the sale of Visa Class B shares.

Noninterest expense was $89.90M for the quarter ended December 31, 2017, a boost of $5.10M from $84.80M in the quarter ended September 30, 2017, and a boost of $5.40M from $84.50M in the quarter ended December 31, 2016.  The increase in noninterest expense contrast to the third quarter of 2017 was mainly because of $5.60M higher salaries and employee benefits and $0.80M higher cards rewards program expenses, partially offset by $1.10M lower advertising and marketing expenses and $1.10M lower other expenses.  Salaries and benefits in the fourth quarter included a $3.70M expense because of the $1,500 bonuses awarded to virtually all employees following the passage of the Tax Cuts and Jobs Act, higher compensation for tellers because of the formerly revealed salary adjustment and higher compensation because of the change in mortgage origination model.  The increase in noninterest expense contrast to the fourth quarter of 2016 was mainly because of a $6.70M increase in salaries and benefits, offset by lower expenses in other noninterest expense categories.  Noninterest expense for full year 2017 was $347.60M contrast to $337.30M in 2016, a boost of $10.30M, mainly because of $6.10M higher salaries and employee benefits and higher expenses in other noninterest expense categories.

The provision for taxes in the fourth quarter of 2017 included a $47.60M charge because of the revaluation of certain tax-related assets at the projected lower corporate tax rate resulting from the Tax Cuts and Jobs Act.  Besides the one-time charge, the effective tax rate for the fourth quarter of 2017 was 37.1% contrast with 37.7% in the previous quarter and 39.8% percent in the same quarter last year.  Besides the one-time charge in the fourth quarter of 2017, the effective tax rate for the full year 2017 was 37.2% contrast with 38.1% in 2016.

Balance Sheet Highlights:

Total assets were $20.50B at December 31, 2017, contrast to $20.60B at September 30, 2017 and $19.70B at December 31, 2016.

The investment securities portfolio was $5.20B at December 31, 2017, contrast to $5.30B at September 30, 2017 and $5.10B at December 31, 2016.  The portfolio remains mostly comprised of securities issued by U. S. government agencies.

Total loans and leases were $12.30B at December 31, 2017, up 1.1% from $12.10B at September 30, 2017 and up 6.6% from $11.50B at December 31, 2016.

The growth in loans and leases in the most recent quarter was because of increases in residential real estate loans of $88.60M, commercial real estate loans of $41.90M, construction loans of $34.10M and consumer loans of $24.30M.  Commercial and industrial loans declined by $55.00M.  The decline in commercial and industrial loans was because of pay downs in the shared national credit portfolio.  Contrast to December 31, 2016, the growth in loans and leases was because of increases in commercial real estate loans of $324.10M, residential real estate loans of $293.60M, construction loans of $182.90M and consumer loans of $75.70M.  Commercial and industrial loans declined by $104.30M.

Total deposits were $17.60B at December 31, 2017, unchanged from $17.60B at September 30, 2017, and a boost of $0.80B, or 4.9%, contrast to $16.80B at December 31, 2016.

Asset Quality:

The Company’s asset quality remained excellent during the fourth quarter of 2017. Total non-performing assets were $10.20M, or 0.08% of total loans and leases and other real estate owned, at December 31, 2017, contrast to non-performing assets of $8.40M, or 0.07% of total loans and leases and other real estate owned, at September 30, 2017 and non­-performing assets of $9.80M, or 0.08% of total loans and leases and other real estate owned, at December 31, 2016.

Net charge offs for the quarter ended December 31, 2017 were $5.20M, or 0.17% of average loans and leases on an annualized basis, contrast to $4.10M, or 0.13% of average loans and leases on an annualized basis for the quarter ended September 30, 2017 and $3.40M, or 0.12% of average loans and leases on an annualized basis for the quarter ended December 31, 2016.  Net charge-offs for the full year 2017 were $16.70M, or 0.14% of average loans and leases, contrast to net charge-offs of $8.60M, or 0.08% of average loans and leases, in 2016.

The ratio of the allowance for loan and lease losses to total loans and leases was 1.12% at December 31, 2017 contrast to 1.13% at September 30, 2017 and 1.18% at December 31, 2016.

Capital:

Total stockholders’ equity was $2.50B at December 31, 2017, contrast to $2.60B at September 30, 2017 and $2.50B at December 31, 2016.

The tier 1 leverage, common equity tier 1, and total capital ratios were 8.52%, 12.45% and 13.50%, respectively, at December 31, 2017, contrast with 8.66%, 12.71% and 13.77% at September 30, 2017 and 8.36%, 12.75% and 13.85% at December 31, 2016.

The Company offered net profit margin of 39.10%. ROE was recorded as 8.80%. The stock, as of recent close, has shown the weekly upbeat performance of 0.47% which was maintained at -4.11% in this year.

 I am Wayne Parsons and I have over 16 years experience in the financial services industry giving me a vast understanding of how news affects the financial markets. I am an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.

Email: wayne.parsons@nasdaqexpress.com

Wayne Parsons

 I am Wayne Parsons and I have over 16 years experience in the financial services industry giving me a vast understanding of how news affects the financial markets. I am an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.Email: wayne.parsons@nasdaqexpress.com