NASDAQ$HOPE

Hope Bancorp Inc · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Reported a decrease in net income due to the challenging operating environment.

Hope Bancorp reported a net income of $26.8 million for the second quarter of 2020, a decrease compared to the previous quarter and the year-ago quarter. The results were impacted by the COVID-19 crisis and reductions in the Fed Funds rate.

  • New loan originations totaled $832 million, including $480 million of PPP loans.
  • Total deposits increased 10.0% quarter-over-quarter.
  • Total cost of deposits reduced by 47 basis points quarter-over-quarter.
  • Noninterest expense improved to 1.60% as a percentage of average assets.

Headline financials

Total Revenue

$121M

Previous: $130M-6.5%
EPS (adj)

$0.22

Previous: $0.34-35.3%
Net Interest Margin

2.8%

Previous: 3.3%-15.7%
Efficiency Ratio

55.4%

Previous: 55.1%+0.5%
Capital Expenditures

-$3.1M

Previous: -$3.1M-0.1%
Free Cash Flow

$23.6M

Previous: $39.6M-40.3%
Net Income

$26.8M

Previous: $42.7M-37.3%
Operating Income

$47.5M

Previous: $55.4M-14.2%
Gross Profit

$104M

Previous: $128M-19.3%
Cash & Equivalents

$1.47B

Previous: $610M+140.9%
Total Assets

$17.2B

Previous: $15.3B+11.9%
Stock-Based Comp

$1.81M

Previous: $1.51M+20.1%

Revenue & EPS history

Hope Bancorp · Revenue · Quarterly

$121M

Q2 2020-6.5%vs Q2 2019
Beat estimate in 11 of 16 quarters(69%)
ActualEstimate

Forward guidance

The company expects stable loan yields, continued reductions in deposit costs, and deployment of excess cash balances to lead to an expansion of net interest margin in the coming quarters. Initiatives are being developed to restructure the balance sheet and contain expenses to optimize operational performance, which are expected to improve profitability.

Tailwinds

  • Stable loan yields are expected.
  • Continued reductions in deposit costs are anticipated.
  • Deployment of excess cash balances is planned.
  • New initiatives are expected to restructure the balance sheet.
  • Expense containment measures are being implemented.

Headwinds

  • Challenging operating environment due to COVID-19 crisis.
  • Impact of Fed Funds rate reductions on net interest margin.
  • Build-up of liquidity and resulting excess cash balances.
  • Uncertainty related to the social justice movement.
  • Potential deterioration in economic conditions.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

+0.1%

Avg return

Earnings day

-0.5%

Avg return

5 days after

+1.2%

Avg return

30 days after

50%

33 / 66 earnings

Positive

+13.9%

Q1 2020

Best reaction

-8.6%

Q1 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+2.1%-0.5%-1.0%
Q4 2025+3.2%+1.7%+0.0%
Q3 2025+1.0%-1.8%+0.3%
Q2 2025-0.6%-2.2%+3.1%
Q1 2025+1.8%+5.2%+5.4%
Q4 2024+1.1%-3.8%-10.8%
Q3 2024+0.0%-0.9%+10.4%
Q2 2024-2.6%-9.6%-6.1%
Q1 2024-8.6%-1.1%-7.7%
Q4 2023-7.3%-8.7%-8.2%
Q3 2023-4.6%-1.8%+12.7%
Q2 2023+4.1%+14.3%-0.9%
Q1 2023-6.0%-6.1%-13.0%
Q4 2022-4.2%-3.1%-0.8%
Q3 2022+1.1%+1.5%+3.0%
Q2 2022+3.7%+2.3%+10.6%
Q1 2022+3.5%-0.3%-10.3%
Q4 2021+11.9%+7.1%+7.0%
Q3 2021+0.0%-1.6%+5.1%
Q2 2021+6.0%+3.6%+7.8%
Q1 2021-2.1%-3.0%-0.6%
Q4 2020-7.2%-9.0%+8.7%
Q3 2020+3.3%+10.2%+22.2%
Q2 2020+0.0%+0.0%+1.8%
Q1 2020+13.9%+5.5%+10.9%
Q4 2019+0.9%-2.1%-2.5%
Q3 2019+2.6%-1.3%-1.1%
Q2 2019+2.4%+4.1%-3.9%
Q1 2019+0.5%-2.7%-0.1%
Q4 2018+3.8%+4.5%+5.3%
Q3 2018-4.3%-7.5%-5.6%
Q2 2018-3.5%-1.0%-0.6%
Q1 2018-5.5%-4.1%+0.6%
Q4 2017+2.6%+0.2%-2.7%
Q3 2017+2.1%+5.1%+0.5%
Q2 2017-3.3%-3.3%-9.4%
Q1 2017-5.7%-4.3%-6.5%
Q4 2016+5.6%-0.1%+1.7%
Q3 2016-4.8%-4.7%+12.7%
Q2 2016-1.5%-1.0%+11.5%
Q1 2016-0.5%
Q4 2015+2.2%
Q3 2015-0.2%
Q2 2015+0.8%
Q1 2015+0.0%
Q4 2014+0.6%
Q3 2014+1.9%
Q2 2014-0.2%
Q1 2014+3.4%
Q4 2013+2.4%
Q3 2013+0.6%
Q2 2013-0.1%
Q1 2013-0.5%
Q4 2012+3.8%
Q3 2012-0.8%
Q2 2012+0.1%
Q1 2011-2.0%
Q4 2011-2.0%
Q1 2012+2.0%
Q4 2009+5.2%
Q3 2011-4.6%
Q3 2010-4.6%
Q2 2011-5.2%
Q2 2010-5.2%
Q4 2010-5.2%
Q1 2010+10.2%

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