Hingham Savings (HIFS) Announces First Quarter 2025 Earnings Results

Hingham Institution for Savings today announced its financial results for the latest quarter. The company reported a quarterly revenue of $49.8 million, meeting expectations, and posted a quarterly diluted earnings per share of $3.24, also in line with forecasts. These results reflect the company’s steady performance in the current economic climate.

Key Highlights:

• Hingham Institution for Savings reported a net income of $7.124 million for Q1 2025, a 3.5% increase in diluted earnings per share compared to Q1 2024.
• Core net income for Q1 2025 was $6.125 million, marking a 175.2% increase from the same period in 2024.
• Total assets reached $4.523 billion, with a 5.9% annualized growth year-to-date.
• Retail and commercial deposits grew by 13.8% annualized year-to-date, with non-interest-bearing deposits increasing by 30.0%.
• The net interest margin improved to 1.50% in Q1 2025, up from 0.85% in Q1 2024.
• The efficiency ratio decreased to 45.82% in Q1 2025 from 77.24% in Q1 2024.
• Chairman Robert H. Gaughen Jr. expressed cautious optimism about future returns, emphasizing the bank’s focus on capital allocation and cost control.

Summary:

Hingham Institution for Savings reported a strong financial performance for the first quarter of 2025, with net income reaching $7.124 million, translating to $3.27 per share basic and $3.24 per share diluted. This represents a 3.5% increase in diluted earnings per share compared to the same period last year. The bank’s core net income, which excludes gains on equity securities, saw a significant increase of 175.2% from Q1 2024, reaching $6.125 million. The bank’s total assets grew to $4.523 billion, with a notable increase in retail and commercial deposits, which rose by 13.8% annualized year-to-date. Non-interest-bearing deposits also saw substantial growth, reflecting the bank’s strategic focus on deepening relationships with commercial and non-profit customers.

The bank’s operational performance showed marked improvement, with the net interest margin increasing to 1.50% in Q1 2025 from 0.85% in the same period last year. This was driven by a decline in the cost of interest-bearing liabilities and an increase in the yield on interest-earning assets. The efficiency ratio improved significantly, decreasing to 45.82% from 77.24% in Q1 2024, indicating enhanced operational efficiency. Chairman Robert H. Gaughen Jr. highlighted the challenges posed by the current interest rate environment but expressed cautious optimism about future returns. He emphasized the bank’s commitment to careful capital allocation, defensive underwriting, and rigorous cost control as key strategies for compounding shareholder capital over time.

Hingham Institution for Savings (HIFS) has experienced a notable price fluctuation over the past year, with a remarkable 34.44% increase, despite recent short-term declines. Over the past month, the stock has dipped by 6.91%, and over the past six months, it has decreased by 8.26%, indicating some volatility in its market performance. The company’s price-to-earnings ratio stands at 16.93, suggesting a moderate valuation relative to its earnings. However, the fundamental metrics reveal some challenges, with a concerning two-year compound annual growth rate (CAGR) in earnings per share (EPS) of -52.42% and a free cash flow CAGR of -53.05%, indicating potential profitability and liquidity issues. On a brighter note, HIFS has achieved a robust revenue CAGR of 32.87% over the same period, showcasing its ability to grow its top line. The net profit margin is healthy at 27.59%, reflecting efficient cost management and profitability. However, the return on invested capital is quite low at 0.50%, suggesting that the company may not be utilizing its capital as effectively as it could. Overall, while HIFS shows strong revenue growth and profitability, the negative trends in EPS and free cash flow growth warrant cautious optimism.

Hingham Institution for Savings provides various financial products and services to individuals and businesses in the United States. It offers savings, checking, money market, demand deposit, and negotiable order of withdrawal accounts, as well as certificates of deposit. The company also provides commercial and residential real estate, construction, home equity, commercial, and consumer loans. In addition, it offers ATMs, debit cards, and Internet-based banking services. The company offers its services through a network of six offices in Boston and eastern Massachusetts; and commercial lenders and relationship managers in Washington. Hingham Institution for Savings was incorporated in 1834 and is headquartered in Hingham, Massachusetts.