Is Hope Bancorp, Inc. overvalued or undervalued?

As of 11 June 2025, the valuation grade for Hope Bancorp, Inc. has moved from fair to very attractive, indicating a significant improvement in its investment appeal. The company is currently considered undervalued, with a P/E ratio of 15, which is notably lower than its peers, such as Pathward Financial, Inc. at 9.68 and Stellar Bancorp, Inc. at 11.91. Additionally, Hope Bancorp's price to book value stands at 0.68, further suggesting that the stock is trading below its intrinsic value.
In terms of profitability, Hope Bancorp has a return on equity (ROE) of 4.62% and a return on capital employed (ROCE) of 8.54%, which are relatively modest but indicate operational efficiency. The company also offers a dividend yield of 4.56%, which is attractive for income-focused investors. Despite a recent decline in stock performance compared to the S&P 500, where it has returned -14.73% year-to-date versus the index's 2.44%, the current valuation metrics suggest that Hope Bancorp presents a compelling investment opportunity.