Fact based stock research
Heritage Financial (NasdaqGS:HFWA)

US42722X1063

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Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

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Heritage Financial stock research in summary

hf-wa.com

ANALYSIS: With an Obermatt Combined Rank of 46 (worse than 54% compared with investment alternatives), Heritage Financial (Regional Banks, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Heritage Financial are a good value (attractively priced) with a consolidated Value Rank of 56 (better than 56% of alternatives), are safely financed (Safety Rank of 53, which means low debt burdens), but show below-average growth (Growth Rank of 42). ...read more

RECOMMENDATION: A Combined Rank of 46, is a hold recommendation based on Heritage Financial's financial characteristics. As the company Heritage Financial's key financial metrics exhibit good value (Obermatt Value Rank of 56) but low growth (Obermatt Growth Rank of 42) while being safely financed (Obermatt Safety Rank of 53), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 56% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	56
Growth Rank	42
Safety Rank	53
Combined Rank	46

Country	USA
Industry	Regional Banks
Index	Sound Pay USA, NASDAQ
Size class	Small

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Heritage Financial

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	90	37	63	56
GROWTH
GROWTH	56	10	22	42
SAFETY
SAFETY	92	57	53	53
SENTIMENT
SENTIMENT	n/a	31	53	^new
360° VIEW
360° VIEW	n/a	13	39	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Heritage Financial is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	90	37	63	56
GROWTH
GROWTH	56	10	22	42
SAFETY
SAFETY	92	57	53	53
COMBINED
COMBINED	92	12	34	46

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Heritage Financial the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 56 (better than 56% compared with alternatives), Heritage Financial shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Heritage Financial. Expected dividend yields are higher than for 78% of comparable companies (a Dividend Yield rank of 78), making the stock attractive. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 69, which means that the stock price is lower compared with invested capital than for 69% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 43 which means that the stock price compared with what market professionals expect for future profits is higher than for 57% of comparable companies, indicating a low value concerning Heritage Financial's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Heritage Financial with a rank of 29. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 71% of comparable companies, indicating a low value concerning Heritage Financial's profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 56, is a buy recommendation based on Heritage Financial's stock price compared with the company's operational size and dividend yields. The company seems confident that it can generate a reasonable return on invested capital, because it pays an above-average dividend while profits are below what you would expect for a company with this stock price. If you agree with this practice and believe that profits will return to higher levels, as the current dividend policy suggests, Heritage Financial may be an attractive investment. If this is not the case, you may want to be careful with this stock as it is also expensive compared with its expected revenue levels. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	67	50	53	43
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	84	11	36	29
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	90	64	77	69
DIVIDEND YIELD
DIVIDEND YIELD	69	49	78	78
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	90	37	63	56

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Heritage Financial; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 42 (better than 42% compared with alternatives), Heritage Financial shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Heritage Financial. Sales Growth has a rank of 67 which means that currently professionals expect the company to grow more than 67% of its competitors. Stock Returns are also above average with a rank of 60. But Capital Growth has only a rank of 30, which means that currently professionals expect the company to grow its invested capital less than 70% of its competitors. Profit Growth is also low, with a rank of only 28, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 42, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 60% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	81	6	52	67
PROFIT GROWTH
PROFIT GROWTH	96	84	39	28
CAPITAL GROWTH
CAPITAL GROWTH	n/a	18	41	30
STOCK RETURNS
STOCK RETURNS	14	11	11	60
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	56	10	22	42

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Heritage Financial.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 53 (better than 53% compared with alternatives), the company Heritage Financial has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Heritage Financial is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Heritage Financial. Leverage is at a rank of 67, meaning the company has a below-average debt-to-equity ratio. It has less debt than 67% of its competitors. Liquidity is also good at a rank of 73, meaning the company generates more profit to service its debt than 73% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 15, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 85% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 53 (better than 53% compared with alternatives), Heritage Financial has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Heritage Financial. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Heritage Financial and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	90	48	64	67
REFINANCING
REFINANCING	53	27	12	15
LIQUIDITY
LIQUIDITY	78	81	79	73
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	92	57	53	53

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Heritage Financial and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	18	45	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	23	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	81	70	^new
MARKET PULSE
MARKET PULSE	n/a	48	42	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	31	53	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Heritage Financial.
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