Cathay General To Buy Back $75M In Stock

Cathay General Bancorp announced a new stock repurchase program of up to $75 million. Shares of the bank closed 1.7% higher on April 1.

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Cathay General’s (CATY) announcement follows the completion of the company’s prior stock repurchase program of $50 million, which was announced on May 7, 2019, and completed on Dec. 9, 2020. Under the completed program, the company repurchased 1,541,912 shares at an average price of $32.43.

In January, Cathay General reported 4Q results. The company’s 4Q earnings rose 6% year-over-year to $0.89 per share and outpaced Street estimates of $0.76. Net interest income decreased 1% to $139.8 million. Additionally, net interest margin came in at 3.12%, down 22 basis points. (See Cathay General stock analysis on TipRanks)

On March 16, Piper Sandler analyst Matthew Clark lifted the stock’s price target to $47 (13.3% upside potential) from $37 and maintained a Hold rating after meeting with management.

Overall, the stock has a Hold consensus rating based on 2 Holds. The average analyst price target of $42.50 implies 2.5% upside potential from current levels. Shares have increased 29.7% so far this year.

According to TipRanks’ Smart Score system, Cathay General gets a 6 out of 10, which indicates that the stock is likely to perform in line with market averages.