Central Pacific Financial (US:CPF) ZACKSยท2024-06-03 15:01Core Viewpoint - Central Pacific Financial Corp. (CPF) is positioned for growth due to balance sheet optimization, strong liquidity, and a solid capital base, with a positive outlook on earnings growth potential [1][3]. Earnings Growth - CPF has experienced an earnings growth of 8.58% over the past three to five years, attributed to stabilized top-line performance and prudent expense management [3]. - The Zacks Consensus Estimate indicates a 7.83% decline in earnings for 2024, followed by a recovery of 17.5% in 2025 [4]. - Analysts have revised the earnings estimates upward by 1% and 5.4% for 2024 and 2025, respectively [1]. Revenue Strength - CPF's revenues have shown a compound annual growth rate (CAGR) of 3.3% from 2019 to 2023, driven by growth in non-interest income [5]. - Net loans and total deposits experienced a CAGR of 5.1% and 7.5%, respectively, over the last four years, although both metrics reversed in the first quarter of 2024 [5]. - The Zacks Consensus Estimate predicts a 2.4% dip in revenues for 2024, with a growth rate of 5.5% in 2025 [6]. Strong Balance Sheet - As of March 31, 2024, CPF's total cash and cash equivalents were $312.9 million, and total debt was $127.8 million [7][8]. - The tier 1 risk-based capital ratio and total risk-based capital ratio were 12.6% and 14.8%, respectively, well above regulatory requirements [8]. Stock Valuation - CPF stock has a Value Score of A, indicating it is trading at a discount and helping investors avoid "value traps" [9]. Market Performance - Over the past six months, CPF shares have gained 9.1%, outperforming the industry's growth of 1.1% [2].