What Happened?
Shares of hawaiian banking company First Hawaiian (NASDAQ: FHB) jumped 3.4% in the afternoon session after positive sentiment spread from its peer, Bank of Hawaii (BOH), as analysts projected strong quarterly earnings for the rival bank.
Wall Street analysts projected that Bank of Hawaii would announce quarterly earnings of $1.25 per share, which represented a 47.1% increase year over year. In addition, revenues were expected to reach $182.45 million, an 11.8% rise from the same quarter in the previous year. When a company in a specific industry or region is expected to perform well, it can often lift the stocks of its competitors as investors bet on similar success across the sector.
After the initial pop the shares cooled down to $27.42, up 3.5% from previous close.
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What Is The Market Telling Us
First Hawaiian Bank’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 3 months ago when the stock dropped 4.4% on the news that disclosures from two lenders raised concerns about deteriorating loan quality across the industry.
The drop was triggered by specific incidents that have spooked investors. Zions Bancorp announced a $50 million charge-off—a debt the bank doesn't expect to collect—on a single loan. Separately, Western Alliance Bancorp revealed it was dealing with a borrower who had failed to provide proper collateral. These events are compounding existing anxieties about the regional banking sector, which is already under pressure from elevated interest rates and declining commercial real estate values. The news heightened investor concerns that more cracks could appear in borrowers' creditworthiness, potentially leading to increased loan losses and reduced profitability for other banks in the sector.
First Hawaiian Bank is up 6.8% since the beginning of the year, and at $27.42 per share, it is trading close to its 52-week high of $28.18 from February 2025. Investors who bought $1,000 worth of First Hawaiian Bank’s shares 5 years ago would now be looking at an investment worth $1,077.
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