Heritage Financial Corporation (HFWA) 10-Year Financial Performance & Capital Metrics

HFWA • • Banking & Credit

Financial ServicesRegional BanksCommunity & Regional Retail BankingWest Coast Community Banks

AboutHeritage Financial Corporation operates as the bank holding company for Heritage Bank that provides various financial services to small and medium sized businesses and individuals in the United States. The company accepts various deposit products, such as noninterest demand deposits, interest bearing demand deposits, money market accounts, savings accounts, personal checking accounts, and certificates of deposit. Its loan portfolio includes commercial and industrial loans, owner-occupied and non-owner occupied commercial real estate loans, one-to-four family residential loans, real estate construction and land development loans, consumer loans, commercial business loans, lines of credit, term equipment financing, and term real estate loans, as well as commercial business loans to a range of businesses in industries that include real estate and rental and leasing, healthcare, accommodation and food services, retail trade, and construction. The company also originates loans that are guaranteed by the U.S. Small Business Administration; and offers trust services, as well as objective advice. As of January 27, 2022, it had a network of 49 banking offices located in Washington and Oregon. The company was formerly known as Heritage Financial Corporation, M.H.C. and changed its name to Heritage Financial Corporation in 1998. Heritage Financial Corporation was founded in 1927 and is headquartered in Olympia, Washington.Show more

Net Interest Income $209M -7.0%
Total Revenue $317M +4.6%
Net Income $43M -30.0%
Return on Equity 5.04% -32.6%
Net Interest Margin 2.95% -6.1%
Efficiency Ratio 49.91% -9.2%
ROA 0.61% -30.6%
Equity / Assets 12.15% +2.2%
Book Value per Share 24.74 +2.2%
Tangible BV/Share 17.75 +3.0%
Debt/Equity 0.47 -23.3%

Technical Analysis

Key Insights

Based on financial data analysis

✓Strengths

✓Efficient operations: 49.9% efficiency ratio
✓Well capitalized: 12.2% equity/assets
✓Healthy dividend yield of 3.6%
✓Trading at only 1.0x book value

✗Weaknesses

No significant weaknesses identified

Price & Volume

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Growth Metrics

Revenue CAGR

10Y8.72%

5Y4.85%

3Y8.63%

TTM-

Profit (Net Income) CAGR

10Y7.49%

5Y-8.53%

3Y-23.87%

TTM52.34%

EPS CAGR

10Y4.22%

5Y-7.49%

3Y-23.13%

TTM52.78%

ROCE

10Y Avg9.15%

5Y Avg8.34%

3Y Avg7.1%

Latest3.49%

Peer Comparison

West Coast Community Banks

Name	Market Cap	Current Price	P/E Ratio	Revenue Growth 1Y	Net Margin	ROE	FCF Yield	Debt/Equity
BCALSouthern California Bancorp	608.64M	18.83	85.59	45.45%	2.94%	11.23%	8.17%	0.17
CWBCCommunity West Bancshares	447.97M	23.38	51.96	51.89%	4.67%	6.95%	3.83%	0.56
GBCIGlacier Bancorp, Inc.	6.29B	48.39	28.80	11.64%	15.27%	6.57%	3.34%	1.18
GBFHGBank Financial Holdings Inc.	465.21M	32.36	23.28	2%	30.99%	11.8%	5.65%	0.22
BOHBank of Hawaii Corporation	2.86B	71.86	20.77	6.6%	14.57%	10.28%	5.9%	0.45
HFWAHeritage Financial Corporation	867.93M	25.56	20.61	4.64%	13.64%	6.33%	7.03%	0.47
HTBKHeritage Commerce Corp	786.28M	12.82	19.42	3.35%	16.12%	6.19%	4.75%	0.06
NRIMNorthrim BanCorp, Inc.	640.63M	29.00	17.47	23.77%	18.87%	19.99%		0.15

Profit & Loss

	Dec 2015	Dec 2016	Dec 2017	Dec 2018	Dec 2019	Dec 2020	Dec 2021	Dec 2022	Dec 2023	Dec 2024
Net Interest Income+	129.62M	132.51M	139.36M	186.99M	199.68M	201M	205.79M	219.38M	225.16M	209.36M
NII Growth %	0.12%	0.02%	0.05%	0.34%	0.07%	0.01%	0.02%	0.07%	0.03%	-0.07%
Net Interest Margin %	-	-	-	-	-	-	-	-	-	-
Interest Income	135.74M	138.51M	147.71M	199.41M	217.85M	214.32M	212.83M	227.46M	284.46M	309.71M
Interest Expense	6.12M	6.01M	8.35M	12.41M	18.17M	13.32M	7.04M	8.07M	59.31M	100.35M
Loan Loss Provision	4.37M	4.93M	4.22M	5.13M	4.31M	36.11M	-29.37M	-1.43M	4.28M	6.28M
Non-Interest Income+	32.27M	31.62M	35.58M	31.62M	32.46M	37.23M	34.62M	29.59M	18.66M	7.47M
Non-Interest Income %	-	-	-	-	-	-	-	-	-	-
Total Revenue+	168.01M	170.13M	183.29M	231.02M	250.31M	251.55M	247.45M	257.05M	303.13M	317.19M
Revenue Growth %	0.22%	0.01%	0.08%	0.26%	0.08%	0%	-0.02%	0.04%	0.18%	0.05%
Non-Interest Expense	106.21M	106.47M	110.58M	149.19M	146.79M	148.94M	149.27M	150.97M	166.62M	158.3M
Efficiency Ratio	-	-	-	-	-	-	-	-	-	-
Operating Income+	51.31M	52.72M	60.15M	64.3M	81.05M	53.18M	120.51M	99.44M	72.92M	52.26M
Operating Margin %	-	-	-	-	-	-	-	-	-	-
Operating Income Growth %	0.84%	0.03%	0.14%	0.07%	0.26%	-0.34%	1.27%	-0.17%	-0.27%	-0.28%
Pretax Income+	51.31M	52.72M	60.15M	64.3M	81.05M	53.18M	120.51M	99.44M	72.92M	52.26M
Pretax Margin %	-	-	-	-	-	-	-	-	-	-
Income Tax+	13.82M	13.8M	18.36M	11.24M	13.49M	6.61M	22.47M	17.56M	11.16M	9M
Effective Tax Rate %	-	-	-	-	-	-	-	-	-	-
Net Income+	37.49M	38.92M	41.79M	53.06M	67.56M	46.57M	98.03M	81.88M	61.76M	43.26M
Net Margin %	-	-	-	-	-	-	-	-	-	-
Net Income Growth %	0.78%	0.04%	0.07%	0.27%	0.27%	-0.31%	1.11%	-0.16%	-0.25%	-0.3%
Net Income (Continuing)	37.49M	38.92M	41.79M	53.06M	67.56M	46.57M	98.03M	81.88M	61.76M	43.26M
EPS (Diluted)+	1.25	1.30	1.29	1.50	1.83	1.29	2.73	2.31	1.75	1.24
EPS Growth %	0.52%	0.04%	-0.01%	0.16%	0.22%	-0.3%	1.12%	-0.15%	-0.24%	-0.29%
EPS (Basic)	1.25	1.30	1.29	1.49	1.84	1.29	2.75	2.33	1.76	1.26
Diluted Shares Outstanding	29.81M	29.69M	29.85M	35.37M	36.99M	36.17M	35.97M	35.46M	35.26M	34.9M

Balance Sheet

	Dec 2015	Dec 2016	Dec 2017	Dec 2018	Dec 2019	Dec 2020	Dec 2021	Dec 2022	Dec 2023	Dec 2024
Cash & Short Term Investments+	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K
Cash & Due from Banks	133.36M	103.75M	103.02M	161.91M	228.57M	743.32M	1.72B	103.59M	224.97M	117.1M
Short Term Investments	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K
Total Investments+	3.19B	3.42B	3.63B	4.6B	4.69B	5.21B	5.05B	6.11B	6.16B	6.22B
Investments Growth %	0.06%	0.07%	0.06%	0.27%	0.02%	0.11%	-0.03%	0.21%	0.01%	0.01%
Long-Term Investments	2.38B	2.62B	2.82B	3.62B	3.74B	4.4B	4.16B	4.77B	5.03B	5.45B
Accounts Receivables	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K
Goodwill & Intangibles+	-	-	-	-	-	-	-	-	-	-
Goodwill	119.03M	119.03M	119.03M	240.94M	240.94M	240.94M	240.94M	240.94M	240.94M	240.94M
Intangible Assets	8.79M	7.37M	6.09M	20.61M	16.61M	13.09M	9.98M	7.23M	4.79M	3.15M
PP&E (Net)	61.89M	63.91M	60.33M	81.1M	87.89M	85.45M	79.37M	76.93M	74.9M	71.58M
Other Assets	67.04M	78.67M	83.44M	101.67M	110.83M	114.24M	128.13M	130.97M	448.41M	436.69M
Total Current Assets	1.01B	988.67M	1.03B	1.25B	1.36B	1.76B	2.82B	1.75B	1.38B	900.98M
Total Non-Current Assets	2.64B	2.89B	3.09B	4.06B	4.19B	4.86B	4.62B	5.23B	5.8B	6.21B
Total Assets+	3.65B	3.88B	4.11B	5.32B	5.55B	6.62B	7.43B	6.98B	7.17B	7.11B
Asset Growth %	0.06%	0.06%	0.06%	0.29%	0.04%	0.19%	0.12%	-0.06%	0.03%	-0.01%
Return on Assets (ROA)	0.01%	0.01%	0.01%	0.01%	0.01%	0.01%	0.01%	0.01%	0.01%	0.01%
Accounts Payable	0	0	0	0	0	0	0	0	0	0
Total Debt+	42.64M	121.42M	144.33M	51.79M	40.76M	56.57M	72.02M	68.07M	521.76M	405.06M
Net Debt	-90.72M	17.68M	41.31M	-110.12M	-187.8M	-686.75M	-1.65B	-35.52M	296.79M	287.96M
Long-Term Debt	19.42M	99.32M	112.51M	20.3M	20.59M	20.89M	21.18M	21.47M	521.76M	405.06M
Short-Term Debt	23.21M	22.1M	31.82M	31.49M	20.17M	35.68M	50.84M	46.6M	0	0
Other Liabilities	0	0	0	0	0	0	0	0	200.06M	153.08M
Total Current Liabilities	3.16B	3.3B	3.49B	4.54B	4.72B	5.77B	6.56B	6.16B	5.6B	5.68B
Total Non-Current Liabilities	19.42M	99.32M	112.51M	20.3M	20.59M	20.89M	21.18M	21.47M	721.82M	558.14M
Total Liabilities	3.18B	3.4B	3.6B	4.56B	4.74B	5.79B	6.58B	6.18B	6.32B	6.24B
Total Equity+	469.97M	481.76M	508.31M	760.72M	809.31M	820.44M	854.43M	797.89M	853.26M	863.53M
Equity Growth %	0.03%	0.03%	0.06%	0.5%	0.06%	0.01%	0.04%	-0.07%	0.07%	0.01%
Equity / Assets (Capital Ratio)	-	-	-	-	-	-	-	-	-	-
Return on Equity (ROE)	0.08%	0.08%	0.08%	0.08%	0.09%	0.06%	0.12%	0.1%	0.07%	0.05%
Book Value per Share	15.76	16.23	17.03	21.51	21.88	22.68	23.75	22.50	24.20	24.74
Tangible BV per Share	-	-	-	-	-	-	-	-	-	-
Common Stock	359.45M	359.06M	360.59M	591.81M	586.46M	571.02M	551.8M	552.4M	549.75M	531.67M
Additional Paid-in Capital	0	0	0	0	0	0	0	0	0	0
Retained Earnings	107.96M	125.31M	149.01M	176.37M	212.47M	224.4M	293.24M	345.35M	375.99M	387.1M
Accumulated OCI	2.56M	-2.61M	-1.3M	-7.46M	10.38M	25.02M	9.4M	-99.85M	-72.48M	-55.24M
Treasury Stock	0	0	0	0	0	0	0	0	0	0
Preferred Stock	0	0	0	0	0	0	0	0	0	0

Cash Flow

	Dec 2015	Dec 2016	Dec 2017	Dec 2018	Dec 2019	Dec 2020	Dec 2021	Dec 2022	Dec 2023	Dec 2024
Cash from Operations+	51.4M	53.98M	73.51M	90.41M	92.49M	70.33M	69.53M	94.46M	109.52M	64.48M
Operating CF Growth %	0%	0.05%	0.36%	0.23%	0.02%	-0.24%	-0.01%	0.36%	0.16%	-0.41%
Net Income	37.49M	38.92M	41.79M	53.06M	67.56M	46.57M	98.03M	81.88M	61.76M	43.26M
Depreciation & Amortization	16.07M	14.12M	11.99M	21.44M	18.11M	-87K	-18.63M	3.09M	5.6M	3.23M
Deferred Taxes	0	0	0	0	0	0	0	871K	-13.2M	-15.29M
Other Non-Cash Items	0	0	7M	2.97M	-3.23M	31.44M	-13.54M	4.82M	51.04M	24.58M
Working Capital Changes	-1.94M	725K	10.63M	10.2M	6.82M	-11.15M	0	0	0	4.36M
Cash from Investing+	-216.62M	-252.93M	-241.39M	-109.6M	-125.3M	-538.55M	163.76M	-1.21B	-93.45M	-85.9M
Purchase of Investments	-286.02M	-267.66M	-149.91M	-342.14M	-242.78M	-152.62M	-756.41M	-1.2B	-178.4M	-33.13M
Sale/Maturity of Investments	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K
Net Investment Activity	-	-	-	-	-	-	-	-	-	-
Acquisitions	-150.14M	-234.94M	-206.28M	105.97M	0	0	0	0	-13.83M	0
Other Investing	-170.67M	-248.33M	-218.34M	-98.74M	-155.79M	-698.19M	656.38M	-240.23M	-315.47M	-488.67M
Cash from Financing+	170.23M	176.05M	167.15M	78.08M	99.47M	982.97M	746.68M	-506.38M	105.31M	-86.45M
Dividends Paid	-15.92M	-21.57M	-18.3M	-25.79M	-30.91M	-28.86M	-28.94M	-29.49M	-30.82M	-31.78M
Share Repurchases	-7.74M	-2.89M	-737K	-1.7M	-8.64M	-19.12M	-22.89M	-3.2M	-6.97M	-22.42M
Stock Issued	0	0	0	0	0	0	0	0	0	0
Net Stock Activity	-	-	-	-	-	-	-	-	-	-
Debt Issuance (Net)	0	1000K	1000K	-1000K	0	0	0	0	1000K	-1000K
Other Financing	193.88M	120.91M	173.29M	214.08M	139.01M	1.03B	798.5M	-473.69M	-356.9M	84.74M
Net Change in Cash+	5M	-22.89M	-730K	58.9M	66.66M	514.75M	979.97M	-1.62B	121.38M	-107.87M
Exchange Rate Effect	0	0	0	0	0	0	0	0	0	0
Cash at Beginning	121.64M	126.64M	103.75M	103.02M	161.91M	228.57M	743.32M	1.72B	103.59M	224.97M
Cash at End	126.64M	103.75M	103.02M	161.91M	228.57M	743.32M	1.72B	103.59M	224.97M	117.1M
Interest Paid	6.32M	6M	8.4M	12.38M	17.87M	13.14M	6.79M	7.71M	46.13M	112.22M
Income Taxes Paid	15.29M	11.5M	2.04M	5.63M	7.53M	13.43M	9.89M	5.04M	2.97M	1.5M
Free Cash Flow+	49.58M	47.26M	70.45M	67.15M	79.45M	63.33M	66.51M	90.44M	99.15M	61.02M
FCF Growth %	0.05%	-0.05%	0.49%	-0.05%	0.18%	-0.2%	0.05%	0.36%	0.1%	-0.38%

Banking Ratios

Metric	2015	2016	2017	2018	2019	2020	2021	2022	2023	2024
Return on Equity (ROE)	8.11%	8.18%	8.44%	8.36%	8.61%	5.71%	11.71%	9.91%	7.48%	5.04%
Return on Assets (ROA)	1.05%	1.03%	1.05%	1.13%	1.24%	0.77%	1.4%	1.14%	0.87%	0.61%
Net Interest Margin	3.55%	3.42%	3.39%	3.52%	3.6%	3.04%	2.77%	3.14%	3.14%	2.95%
Efficiency Ratio	63.22%	62.58%	60.33%	64.58%	58.64%	59.21%	60.32%	58.73%	54.97%	49.91%
Equity / Assets	12.87%	12.42%	12.36%	14.31%	14.57%	12.4%	11.5%	11.43%	11.89%	12.15%
Book Value / Share	15.76	16.23	17.03	21.51	21.88	22.68	23.75	22.5	24.2	24.74
NII Growth	12.3%	2.23%	5.17%	34.18%	6.79%	0.66%	2.38%	6.61%	2.63%	-7.01%
Dividend Payout	42.46%	55.42%	43.8%	48.61%	45.75%	61.97%	29.52%	36.02%	49.91%	73.46%

Revenue by Segment

	2023	2024
Deposit Account	10.97M	11.29M
Deposit Account Growth	-	2.91%
Credit and Debit Card	8.34M	7.75M
Credit and Debit Card Growth	-	-7.05%

Frequently Asked Questions

Valuation & Price

Heritage Financial Corporation (HFWA) has a price-to-earnings (P/E) ratio of 20.6x. This is roughly in line with market averages.

Growth & Financials

Heritage Financial Corporation (HFWA) grew revenue by 4.6% over the past year. Growth has been modest.

Yes, Heritage Financial Corporation (HFWA) is profitable, generating $57.2M in net income for fiscal year 2024 (13.6% net margin).

Dividend & Returns

Yes, Heritage Financial Corporation (HFWA) pays a dividend with a yield of 3.56%. This makes it attractive for income-focused investors.

Heritage Financial Corporation (HFWA) has a return on equity (ROE) of 5.0%. This is below average, suggesting room for improvement.

Industry Metrics

Heritage Financial Corporation (HFWA) has a net interest margin (NIM) of 2.9%. NIM has been under pressure due to interest rate environment.

Heritage Financial Corporation (HFWA) has an efficiency ratio of 49.9%. This is excellent, indicating strong cost control.

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