A Look At OFG Bancorp (OFG) Valuation After Dividend Hike And New Share Buyback Program

OFG Bancorp (OFG) has paired a 17% lift in its regular quarterly dividend to US$0.35 per share with Board approval of a new share repurchase program totaling up to US$200 million.

See our latest analysis for OFG Bancorp.

These capital actions come as OFG Bancorp trades at US$41.12, with a 7 day share price return of 3.47% but a 1 year total shareholder return decline of 3.74%, suggesting that near term momentum contrasts with a more muted longer term outcome.

If this kind of capital return story has your attention, it could be a good time to broaden your watchlist and check out our screener of 22 top founder-led companies.

With OFG Bancorp trading at US$41.12, sitting roughly 8% below one analyst price target and flagged with a high intrinsic discount, you have to ask: is there mispricing here, or is the market already baking in future growth?

Most Popular Narrative: 7.4% Undervalued

With OFG Bancorp closing at $41.12 against a narrative fair value of $44.40, the current price sits below what that narrative work suggests, and the buyback plus dividend lift put extra focus on how those assumptions stack up.

Investments in a digital first strategy and streamlined processes are expected to yield long term operational efficiencies, gradually improving the efficiency ratio and supporting higher profitability, even as competition and regulatory costs remain elevated.

Read the complete narrative.

Curious what kind of revenue pace and margin reset sit behind that fair value tag, and how much earnings power the narrative is baking in over time. Want to see how those moving pieces, including future profitability and valuation multiples, are tied together in one story. The full narrative lays out the numbers that underpin that $44.40 figure.

Result: Fair Value of $44.40 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, you still need to weigh concentration in Puerto Rico and reliance on government and commercial deposits, which could pressure credit quality and funding if conditions change.

Find out about the key risks to this OFG Bancorp narrative.

Build Your Own OFG Bancorp Narrative

If you see the story differently or simply want to test your own assumptions against the data, you can build a personalized view of OFG in just a few minutes, starting with Do it your way.

A great starting point for your OFG Bancorp research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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