BOH is now overvalued and could go down -25%

Based on our analysis, Bank of Hawaii has received an overvalued rating of 2 out of 5 stars from Cashu. Several key financial ratios indicate that the company's valuation may not be justified when compared to its sector peers. The price-to-earnings (PE) ratio for Bank of Hawaii stands at 17.27, significantly higher than the sector average of 11.69. A high PE ratio can suggest that investors expect high growth rates, but it may also indicate overvaluation if such growth does not materialize. Additionally, the price-to-book (PB) ratio is 1.70, compared to the sector's 1.12. This indicates that the market values the bank at a premium relative to its book value, which may not be sustainable. While Bank of Hawaii boasts a robust net profit margin of 32.35, which exceeds the sector's 18.54, it is essential to note that this strong profitability does not compensate for the elevated valuation metrics. The return on assets (ROA) ratio is 0.64, lower than the sector average of 0.88, suggesting that the bank is less efficient in generating profit from its assets compared to its competitors. The dividend yield of 4.59 is appealing, exceeding the sector's 3.08, but high yields can also indicate potential risks if not supported by strong earnings growth. Overall, the combination of elevated valuation ratios and lower efficiency metrics raises concerns about Bank of Hawaii's current market price. This is not a comprehensive overview of our valuation, and should not be viewed as financial advice. Always do your own research before considering an investment.