Cathay General Bancorp (CATY) AI Stock Analysis

• Market Cap: $3.36B
• Dividend Yield: 2.81%
• Average Volume (3M): 413.70K
• Price to Earnings (P/E): 11.7
• Beta (1Y): 0.93
• Revenue Growth: -0.17%
• EPS Growth: -0.29%
• Country: US
• Employees: 1,266
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 1.10
• Shares Outstanding: 69,093,414
• 10 Day Avg. Volume: 582,010
• 30 Day Avg. Volume: 413,699
• PEG Ratio: -0.64
• Price to Book (P/B): 1.21
• Price to Sales (P/S): 2.47
• P/FCF Ratio: 10.54
• Enterprise Value/Market Cap: 1.07
• Enterprise Value/Revenue: 2.60
• Enterprise Value/Gross Profit: 5.19
• Enterprise Value/Ebitda: 10.53
• 1Y Price Target: $51.25
• Price Target Upside: 5.95% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 71 Outperform
• Price Target: $52.00 ▲(7.50% Upside)

Cathay General Bancorp's overall stock score reflects strong financial performance and reasonable valuation. The company's robust profitability and stable cash flow are significant strengths. Technical analysis indicates mixed signals, while the earnings call reveals both growth prospects and operational challenges. The stock's valuation is fair, with a moderate dividend yield enhancing its appeal.

Positive Factors

Strong Loan Growth

The significant increase in loans, particularly in commercial and real estate sectors, indicates strong demand for the bank's services and supports future revenue growth.

Effective Cash Management

Steady cash generation and effective cash management enhance the company's ability to invest in growth opportunities and maintain financial stability.

Improvement in Deposit Growth

Growth in core deposits strengthens the bank's funding base, supporting lending activities and enhancing financial flexibility.

Negative Factors

Increase in Net Charge-Offs

Rising net charge-offs indicate potential credit quality issues, which could impact profitability and require increased provisioning.

Rise in Classified Loans

An increase in classified loans suggests deteriorating asset quality, posing risks to financial stability and requiring careful management.

Increase in Nonaccrual Loans

Higher nonaccrual loans reflect credit risk and may lead to reduced interest income, affecting overall financial performance.

Cathay General Bancorp Business Overview & Revenue Model

Company Description

Cathay General Bancorp operates as the holding company for Cathay Bank that offers various commercial banking products and services to individuals, professionals, and small to medium-sized businesses in the United States. The company offers various deposit products, including passbook accounts, checking accounts, money market deposit accounts, certificates of deposit, individual retirement accounts, and public funds deposits. It also provides loan products, such as commercial mortgage loans, commercial loans, small business administration loans, residential mortgage loans, real estate construction loans, and home equity lines of credit, as well as installment loans to individuals for household, and other consumer expenditures. In addition, the company offers trade financing, letter of credit, wire transfer, forward currency spot and forward contract, traveler's check, safe deposit, night deposit, social security payment deposit, collection, bank-by-mail, drive-up and walk-up window, automatic teller machine, Internet banking, investment, and other customary bank services, as well as securities and insurance products. As of March 1, 2022, it operated 31 branches in Southern California, 16 branches in Northern California, 10 branches in New York, four branches in Washington, two branches in Illinois, and two branches in Texas, as well as one branch each in Maryland, Massachusetts, Nevada, and New Jersey, and Hong Kong; and a representative office each in Beijing, Taipei, and Shanghai. The company was founded in 1962 and is headquartered in Los Angeles, California.

How the Company Makes Money

Cathay General Bancorp generates revenue primarily through interest income from loans and investment securities, as well as non-interest income from various banking services. The key revenue streams include interest earned on commercial and residential loans, which constitute a significant portion of their earnings. Additionally, the bank earns fees from deposit accounts, service charges, and other transactional services. Investment in securities also contributes to interest income. The company benefits from its strong reputation within the Asian-American community, fostering customer loyalty and driving business growth. Furthermore, strategic partnerships with local businesses and community organizations enhance its market presence and customer base, positively impacting its financial performance.

Cathay General Bancorp Financial Statement Overview

Summary

Cathay General Bancorp exhibits strong financial performance with robust profitability and stable cash flow. The income statement shows healthy margins, although there's a slight revenue decrease in the TTM. The balance sheet is stable with conservative debt usage, and cash flow management is effective, supporting business operations.

Income Statement

Cathay General Bancorp shows strong profitability and stability in its income statement. The TTM data reveals a gross profit margin of approximately 50.1%, with a net profit margin of 20.6%, indicating efficient cost management and profitability. The revenue growth trajectory has been positive, with some fluctuations, as evidenced by the revenue growth rate from 2023 to 2024 being 6.1%. However, there's a slight decline in revenue in the TTM period compared to 2024. The EBIT and EBITDA margins are healthy at 23.5% and 24.7%, respectively, displaying solid operational performance.

Balance Sheet

The balance sheet of Cathay General Bancorp reflects a stable financial position with manageable leverage. The debt-to-equity ratio stands at 0.09 in the TTM, showing conservative use of debt. Return on Equity (ROE) is robust at 9.9%, indicative of effective use of equity capital. The equity ratio is also strong at 12.3%, highlighting a solid equity position relative to total assets. Overall, the balance sheet is healthy, but the equity ratio suggests room for improvement in asset utilization.

Cash Flow

Cathay General Bancorp's cash flow statement demonstrates effective cash management. The free cash flow growth rate in the TTM is 2.8%, indicating steady cash generation. The operating cash flow to net income ratio is 1.20, showing that operating activities are producing sufficient cash compared to earnings. The free cash flow to net income ratio is 1.18, reflecting strong cash flow relative to profits. The company's cash flow position is stable, supporting its investment and financing activities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.38B	1.39B	1.31B	908.10M	721.11M	743.39M
Gross Profit	691.28M	692.22M	784.06M	775.97M	668.37M	537.43M
EBITDA	340.79M	334.37M	421.69M	492.34M	397.96M	270.48M
Net Income	284.05M	285.98M	354.12M	360.64M	298.30M	228.86M
Balance Sheet
Total Assets	23.21B	23.05B	23.08B	21.99B	20.89B	19.04B
Cash, Cash Equivalents and Short-Term Investments	1.97B	1.70B	2.43B	2.63B	3.58B	2.46B
Total Debt	263.95M	227.73M	709.72M	659.25M	192.97M	326.33M
Total Liabilities	20.34B	20.21B	20.34B	19.51B	18.44B	16.62B
Stockholders Equity	2.87B	2.85B	2.74B	2.47B	2.45B	2.42B
Cash Flow
Free Cash Flow	334.53M	325.52M	381.34M	464.00M	330.59M	314.18M
Operating Cash Flow	339.94M	329.15M	384.74M	467.39M	334.32M	319.95M
Investing Cash Flow	292.14M	184.03M	-1.48B	-1.85B	-859.92M	-242.20M
Financing Cash Flow	-423.51M	-302.47M	758.74M	94.74M	1.55B	749.55M

Cathay General Bancorp Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 48.37
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CATY, the sentiment is Neutral. The current price of 48.37 is below the 20-day moving average (MA) of 49.26, above the 50-day MA of 47.89, and above the 200-day MA of 45.20, indicating a neutral trend. The MACD of 0.17 indicates Positive momentum. The RSI at 47.59 is Neutral, neither overbought nor oversold. The STOCH value of 39.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CATY.

Cathay General Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CBU	78 Outperform	3.17B	16.36	10.34%	3.11%	11.95%	14.53%
WSBC	75 Outperform	3.11B	19.45	3.54%	4.61%	30.52%	-21.64%
WSFS	72 Outperform	3.06B	11.99	9.95%	1.16%	0.30%	1.46%
FHB	72 Outperform	3.13B	12.99	9.15%	4.15%	-2.56%	12.05%
FULT	71 Outperform	3.41B	10.99	9.73%	3.78%	17.61%	1.89%
CATY	71 Outperform	$3.36B	11.71	10.38%	2.81%	-0.17%	-0.29%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Cathay General Bancorp Corporate Events

Cathay General Bancorp Reports Strong Q2 2025 Results

Cathay General Bancorp announced its financial results for the second quarter of 2025, reporting a net income of $77.5 million, an increase from the previous quarter. The company saw improvements in net interest margin, total loans, and deposits, and initiated a stock repurchase program. The financial performance highlights a robust growth trajectory, with significant increases in net interest income and non-interest income, indicating strong operational efficiency and strategic financial management.

The most recent analyst rating on (CATY) stock is a Hold with a $43.00 price target. To see the full list of analyst forecasts on Cathay General Bancorp stock, see the CATY Stock Forecast page.

Cathay General Bancorp Announces $150M Share Buyback

On June 4, 2025, Cathay General Bancorp announced a new share repurchase program authorizing the buyback of up to $150 million of its common stock. This initiative follows the completion of a previous $125 million repurchase program. The timing, price, and volume of repurchases will be determined by management, and the program can be adjusted based on market conditions and other factors. This move reflects the company’s strategic financial management and could impact its stock value and shareholder returns.

The most recent analyst rating on (CATY) stock is a Buy with a $60.00 price target. To see the full list of analyst forecasts on Cathay General Bancorp stock, see the CATY Stock Forecast page.

Cathay General Bancorp Approves Amended Incentive Plan

On May 12, 2025, Cathay General Bancorp held its Annual Meeting of Stockholders, where several key decisions were made. The stockholders approved the amended and restated 2005 Incentive Plan, which increased the number of shares authorized for issuance by 1,724,538. Additionally, four Class II directors were elected, the executive compensation was approved, and KPMG LLP was ratified as the independent registered public accounting firm for the 2025 fiscal year. These decisions are likely to impact the company’s operations by aligning executive incentives with shareholder interests and ensuring continued financial oversight.

The most recent analyst rating on (CATY) stock is a Hold with a $43.00 price target. To see the full list of analyst forecasts on Cathay General Bancorp stock, see the CATY Stock Forecast page.