OFG Bancorp Dossier - Source-backed chat

OFG Bancorp

OFGNYSE

SectorFinancials

IndustryBanks - Regional

Beta (adjusted)0.80

Intrinsic Value $38.71median of 2 methodsbased on filings through 30 Jun 2026

Market Price $50.69Price as of 1 Oct 2026

OvervaluedIntrinsic value is 24% below the market price

−50% · IV below pricenear fair value ±15%IV above price · +50%

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Market Cap $2.1B

Shares Outstanding 42.1M diluted

Next Earnings Date21 Oct 2026

Last ex-dividend30 Sep 2026

All prices and values are periodic snapshots, not live quotes. Source dates are shown for reference.

Thesis

Street consensus, scenarios, merits, risks, and invalidation triggers

AI-assisted

Thesis Summary

OFG Bancorp (parent of Oriental Bank) represents a highly profitable, technology-driven regional banking franchise dominant in Puerto Rico. The company consistently delivers superior profitability metrics, including a Net Interest Margin (NIM) of 5.36% and a ROATCE of 16.43% as of Q1 2026, significantly outperforming U.S. mainland regional peers. Despite facing headwinds from government deposit outflows, OFG's strong retail and commercial deposit franchise, combined with aggressive capital returns ($200M buyback program and a 17% dividend hike in early 2026), positions the stock as an attractive value play trading at a modest trailing P/E of ~9.6x.

This section is the 12-month view: analyst targets and the probability-weighted scenarios built from them. The intrinsic value at the top of this page answers a different question: what the business is worth today.

Street view · analyst 12-month targets4 analysts · as of 18 Aug 2026

Low · most bearish analyst$55.00

Mean target$56.50

High · most bullish analyst$58.00

Street targets sit above today's price; our intrinsic value sits below it. Different horizons, different questions.

Our research · scenarios, merits, risks, and invalidation triggersResearch as of 18 Sep 2026

Scenarios · 12-month scenario targetsAnchored at research date

Bear CaseDownside scenario

$55.00

Severe government deposit outflows force increased reliance on high-cost wholesale funding, compressing NIM below 4.80%. Credit quality normalizes faster than expected, leading to elevated provisions for credit losses in the auto and consumer loan portfolios.

Base CaseCentral scenario

$56.50

Matches the consensus mean

OFG maintains its strong market share in Puerto Rico, with steady organic loan growth of 5-7% annually. NIM compresses slightly but remains highly resilient above 5.10% despite competitive deposit pricing. The company successfully executes its capital return program, supporting EPS growth.

Bull CaseUpside scenario

$58.00

Accelerated digital adoption drives further operational efficiency, pushing the efficiency ratio below 50%. Loan production in high-yield auto and commercial segments exceeds expectations, while Puerto Rico's local economic reconstruction funds stimulate robust credit demand. NIM remains stable above 5.40% due to rate-sensitive asset repricing.

Scenarios are anchored to street consensus at the research date, with our probabilities and rationale.

Key Investment Merits

Industry-leading Net Interest Margin (NIM) of 5.36% driven by a high-yield loan mix and a strong local deposit franchise.
Robust capital return profile, highlighted by a $200 million share repurchase authorization and a 17% dividend increase in early 2026.
High digital adoption rates among retail and commercial customers, enhancing operating efficiency and customer retention.

Key Investment Risks

Geographic concentration in Puerto Rico, exposing the bank to local economic, fiscal, and hurricane-related risks.
Funding cost pressures arising from competitive deposit pricing and government demand deposit outflows.
Potential normalization of credit quality, particularly in consumer and auto loan portfolios, leading to higher provisions.

Thesis Invalidation Triggers

NIM compressing below 4.75% due to rapid deposit beta increases or wholesale funding reliance.
A significant spike in non-performing loans (NPLs) or net charge-offs indicating systemic credit deterioration in Puerto Rico.
Regulatory changes or political instability in Puerto Rico adversely affecting the local banking operating environment.

All scenarios are estimates and subject to change. Past performance is not indicative of future results.

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Explore this dossier

ValuationIntrinsic value, the six-method breakdown, peer medians, and your assumptions sandbox.Financial SnapshotRevenue, profitability, returns, balance sheet, dividends, and the filing-level detail.Qualitative AnalysisBusiness overview, strategic initiatives, and mergers, acquisitions & partnerships.Outlook & Key DatesForward estimates, reporting calendar, and the monitoring framework.