Deutsche Sees First Hawaiian Trading At An Appropriate Premium, Initiates At Hold

Deutsche Bank initiated coverage on First Hawaiian Inc

with Hold rating and $29 price target. The analysts estimate a core EPS of $1.53/$1.61/$1.75 for FY16/17/18. They view the company as a high quality franchise priced at an appropriate premium, with a more balanced risk/reward following the 16 percent upside post IPO. "That said, we still expect a 12 percent return over the next year (including the 3 percent dividend yield)" wrote the analysts, noting they expect First Hawaiian could outperform in a downturn given the bank's higher ROTCE and stronger credit profile. Shares are trading at 16.5x their FY17 core EPS estimate and a P/TBV of 2.46x. The $29 price target is based on two methodologies: a P/E of 16.6x on their FY18 core EPS estimate and a P/TBV of 2.54x their 2Q17 TBV/share estimate of $11.41.