Stocks & Blondes - Bank of Hawaii (NYSE:BOH)
This article was published on October 19, 2020, and may not reflect the current market rates.
The first time that someone talked to me about buying stock, it was at bedtime. Instead of a story, my father was explaining the benefits of owning stock and how to pick the ones to buy. I was a small child but he was a businessman and in his mind, you could never start young enough. As luck would have it, he was right.
For me, finance is not a career path, it's a personal passion. I’m no financial advisor but, I am fascinated with wealth management, taxes, and insurance. We all have our interests and this one happens to be mine.
Armed with my father’s lessons, wits, and genuine interest, I am making my way and making money... sometimes. It’s a journey, more like an adventure. At the end of the day, this blonde is having a lot of fun and even better, picking some winners. As luck would have it, I think I found one... the Bank of Hawaii (NYSE:BOH).
Bank of Hawaii (NYSE:BOH) - The ups and downs
On October 24, 1980, the Bank of Hawaii debuted on the NYSE at $2.16 USD per share. By November 2016, the share value rose to $85 USD, fluttering up and down between the late ’70s and the late ’80s. In December 2019, BOH stock hit a high of $95.68.
On March 11, 2020, the World Health Organization officially declared that COVID-19 had reached a pandemic level, and Bank of Hawaii shares had plummeted to $61.99 USD. Since then, it kept on falling but never lower than $46.70 USD. Today, it’s trading at $55.03 USD.
Impacted by Covid
The US has been hit extremely hard by the coronavirus and politically, it’s rough. The US economy has suffered greatly. Many people living in the US are facing serious hardship and the financial stress is mounting. Making loan payments on time has become a lot harder for the average US citizen and given everything that’s happening, that is completely understandable. Employment rates are at record-breaking lows. Bank stocks are not doing all that great at the moment. But, there is good reason for that.
Buy stock right now..?
My father always told me to pick stocks using common sense and to look at the whole picture. Right now, the voice in my head is saying that one day, this situation is going to get better. There is a strong possibility that it may get a little worse before this happens but eventually, life will resume some form of normalcy.
As life in Hawaii becomes less stressful socially and economically, these bank shares are going to rise. The majority of its shareholders live in the state and as a result, the Bank of Hawaii pays out some of the highest dividends on the NYSE.
The people living in Hawaii and its stakeholders have a very symbiotic relationship and it’s been working well. On Sept. 15, 2020, BOH paid shareholders a quarterly dividend of $0.67 USD per share at an annual yield rate of 4.7%. This works out to be $2.68 USD paid out per share, each year. The three-year dividend growth rate has been 37.4% and at the moment, buying these shares hasn’t been this cheap since 2016.
Who benefits from investing in BOH?
These shares are an excellent buy for someone looking for a solid stock to hold onto. The likelihood that it will bounce back is quite high so the value increase could make this a worthwhile investment, especially considering the annual dividend. Even better, it’s a direct way to help the Hawaiian economy. With the majority of shareholders being state residents, this annual dividend gets paid all over those islands, stimulating the local economy. Plus, investing in the Bank of Hawaii replaces some of the money that is missing from their ROIs, and that helps everyone stay afloat.
I stumbled upon the Bank of Hawaii when I was googling stocks that pay high dividends. I know that I am not a day trader so I wanted a low-price stock with future growth potential. My goal was to find something I could buy and forget about. But, the share price had to be likely to increase significantly and, I also wanted a stock that would pay me money each year. From a philanthropy standpoint, I had to feel good about the company; or, I couldn’t invest my money. This may have seemed like a tall order but, it's amazing what you can find when you know what you are looking for.
