Territorial Bancorp Inc. (TBNK) | Investment Case

1. Company Snapshot

1.a. Company Description

Territorial Bancorp Inc.operates as the holding company for Territorial Savings Bank that provides various financial services to individuals, families, and businesses in the State of Hawaii.The company offers a range of deposit accounts, including passbook and statement savings accounts, certificates of deposit, money market accounts, commercial and regular checking accounts, and Super NOW accounts.

It also provides various loan products comprising one-to four-family residential mortgage; home equity; consumer; multi-family mortgage; commercial business; and construction, commercial, and other nonresidential real estate loans, as well as lines of credit and investment securities.In addition, the company engages in insurance agency activities.Further, it provides various non-deposit investments, including annuities and mutual funds through a third-party broker-dealer.

The company operates through a network of 29 full-service branches located in the state of Hawaii.Territorial Bancorp Inc.was founded in 1921 and is based in Honolulu, Hawaii.

Show Full description

1.b. Last Insights on TBNK

Territorial Bancorp Inc.'s recent performance was marred by a net loss of $1.72 million, or $0.20 per diluted share, for the three months ended December 31, 2024. This subpar result was largely attributed to $1.53 million of pre-tax merger-related expenses. Furthermore, the company's recent announcement of a merger with Hope Bancorp, Inc. has likely created operational disruptions and distracted management's attention from core business activities. The receipt of regulatory approvals for the merger on March 3, 2025, has brought the deal one step closer to completion, but its impact on the company's short-term performance remains uncertain.

1.c. Company Highlights

Last Price	8.33
Change Percentage	0.00%
Open	8.33
Previous Close	8.33
Market Cap ( Millions)	66
Volume	39901
Year High	11.44
Year Low	6.92
M A 50	8.57
M A 200	9.46

FCF Yield	-1.33%
Dividend Yield	0.12%
ROE	-1.53%
Debt / Equity	64.42%
Net Debt / EBIDTA	-938.92%
Price To Book	0.29
Price Earnings Ratio	-18.81
Price To FCF	-75.34
Price To sales	1.89
EV / EBITDA	-26.47

2. Transcript Summary

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3. NewsRoom

Hope Bancorp Receives Regulatory Approvals for Its Merger With Territorial Bancorp

Mar -03

Source: businesswire.com

Territorial Bancorp Inc. Announces Fourth Quarter 2024 Results

Jan -31

Source: globenewswire.com

Territorial Bancorp Shareholders Approve Hope Bancorp Merger

Nov -06

Source: globenewswire.com

Blue Hill Advisors to Territorial Shareholders: No Risk to Territorial if Board Engages with Us

Oct -29

Source: prnewswire.com

Territorial Bancorp Inc. Announces Third Quarter 2024 Results

Oct -28

Source: globenewswire.com

Investors Behind Territorial Proposal Advance Offer with Detailed Disclosure to Board

Oct -25

Source: prnewswire.com

Leading Independent Proxy Advisory Firm Glass Lewis Joins ISS in Recommending that Territorial Shareholders Vote “FOR” Merger with Hope Bancorp

Oct -25

Source: globenewswire.com

Yakira Capital Refutes Territorial Bancorp's Board of Directors' Public Concerns Related to Acquisition Offer from Blue Hill Advisors

Oct -24

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.77%)

6. Segments

Banking and Related Activities

Expected Growth: 4.77%

Territorial Bancorp Inc.'s 4.77% growth in Banking and Related Activities is driven by increasing loan demand, expansion of deposit base, and improved asset quality. Additionally, strategic cost management, enhanced digital banking capabilities, and favorable interest rate environment contribute to the growth.

7. Detailed Products

Personal Banking

Territorial Bancorp Inc. offers a range of personal banking services, including checking and savings accounts, credit cards, personal loans, and mortgages.

Business Banking

The company provides business banking services, including business checking and savings accounts, commercial loans, and cash management solutions.

Mortgage Lending

Territorial Bancorp Inc. offers a variety of mortgage loan options, including fixed-rate and adjustable-rate mortgages, refinancing, and home equity loans.

Investment Services

The company provides investment services, including brokerage services, investment advice, and wealth management solutions.

Trust Services

Territorial Bancorp Inc. offers trust services, including estate planning, trust administration, and investment management.

8. Territorial Bancorp Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Territorial Bancorp Inc. is medium due to the presence of alternative financial institutions and online banking services.

Bargaining Power Of Customers

The bargaining power of customers for Territorial Bancorp Inc. is low due to the lack of concentration of buyers and the limited ability of individual customers to influence prices.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Territorial Bancorp Inc. is medium due to the presence of multiple suppliers and the moderate level of dependence on these suppliers.

Threat Of New Entrants

The threat of new entrants for Territorial Bancorp Inc. is low due to the high barriers to entry in the banking industry, including regulatory hurdles and capital requirements.

Intensity Of Rivalry

The intensity of rivalry for Territorial Bancorp Inc. is high due to the presence of multiple competitors in the banking industry, leading to a highly competitive market.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	54.83%
Debt Cost	3.95%
Equity Weight	45.17%
Equity Cost	7.16%
WACC	5.40%
Leverage	121.40%

11. Quality Control: Territorial Bancorp Inc. passed 2 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Tompkins Financial

A-Score: 6.2/10

Value: 6.1

Growth: 4.4

Quality: 6.3

Yield: 8.0

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

Ponce Financial Group

A-Score: 5.3/10

Value: 5.3

Growth: 5.0

Quality: 4.3

Yield: 0.0

Momentum: 8.5

Volatility: 8.7

1-Year Total Return ->

FVCBankcorp

A-Score: 5.0/10

Value: 6.9

Growth: 5.3

Quality: 6.8

Yield: 1.0

Momentum: 4.5

Volatility: 5.3

1-Year Total Return ->

Sterling Bancorp

A-Score: 4.9/10

Value: 4.2

Growth: 2.6

Quality: 6.1

Yield: 5.0

Momentum: 6.0

Volatility: 5.7

1-Year Total Return ->

Pathfinder Bancorp

A-Score: 4.3/10

Value: 5.5

Growth: 3.7

Quality: 2.7

Yield: 5.0

Momentum: 2.5

Volatility: 6.7

1-Year Total Return ->

Territorial Bancorp

A-Score: 4.3/10

Value: 9.2

Growth: 0.9

Quality: 6.2

Yield: 3.0

Momentum: 1.5

Volatility: 5.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

16.73%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

5.40%

Territorial Bancorp Inc. - US88145X1081

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on TBNK

1.c. Company Highlights

Weak Momentum

Lower Growth

Average Yield

Earnings Miss

Revenues Beats

Expensive

Lower Quality

Fairly Valued

Stable Momentum

Average Quality

Revenues Miss

Cheaper

Medium Volatility

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.77%)

6. Segments

Banking and Related Activities

Expected Growth: 4.77%

7. Detailed Products

Personal Banking

Business Banking

Mortgage Lending

Investment Services

Trust Services

8. Territorial Bancorp Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Territorial Bancorp Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

8.33$

Current Price

8.33$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA