HTBK

Heritage Commerce

Fundamental data last updated:April 13, 2026

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company profile

SECTOR

Financial Services

industry

Banks - Regional

Exchange

Nasdaq

County of HQ

United States

Next Earnings Date

04/23/26

Business Summary

Heritage Commerce operates as a regional commercial bank, generating cash primarily through the spread between interest income on loans and the cost of deposits and funding. Its profitability hinges on disciplined credit underwriting, deposit gathering in local markets, and maintaining favorable net interest margins. At 1.2x book, the market is valuing its loan book and deposit franchise slightly above accounting equity, implying moderate confidence in asset quality. The moat, such as it is, rests on localized commercial relationships, recurring deposit bases, and the ability to recycle capital at a 16.00% ROIC without overextending the balance sheet.

 


Analyze HTBK on TradingView

VALUATION

P/E

17.2

Market Cap ($M USD)

$823

Forward P/E

12.5

PEG

1.1

PRICE TO SALES

4.2

PRICE TO BOOK

1.2

EV / EBITDA

-

5-Year Average P/E

Free Cash Flow Yield

DCF Value

Graham Number

Price to FCF

EV to FCF

Earnings Yield

FCF Yield

DIVIDEND

Yield

3.90%

Annual Payout

$0.52

Payout Ratio

66.70%

Consecutive Years of Dividend Growth

0

5-Year Dividend Growth Rate

0.00%

Financial Health & Profitability

Earnings Per Share

$0.78

Next Year EPS Growth Estimate

$1.07

Next Year Revenue Growth Estimate

4.10%

Return on Equity (ROE)

6.80%

FREE CASH FLOW

Operating Margin

41.00%

Debt-to-Equity

0.1

Piotroski F-Score

6

Altman Z-Score

0.2

Return on Invested Capital (ROIC)

16.00%

Current Ratio

-

Quick Ratio

Net Debt to EBITDA

Interest Coverage

Gross Profit margin

FCF PER SHARE

REVENUE PER SHARE

Analyze HTBK on TradingView

Gainseekers Quantitative Analysis

Summary

HTBK screens as a conflicted regional bank: a 17.2 P/E dropping to a 12.5 Forward P/E suggests earnings normalization ahead, but the 1.1 forward PEG implies growth is hardly explosive. The market is valuing it at 1.2x book and 4.2x sales, which is not distressed but hardly expensive for a bank with a 16.00% ROIC. However, the Altman Z-Score of 0.2 is a flashing red light for balance sheet risk, and a 4.10% ROE signals underwhelming capital productivity. This is not a pristine compounder — it’s a cautiously priced regional bank with improving earnings optics but real structural fragility under the surface.

AI Exposure / Tech Reliance

As a Regional Bank, HTBK operates in a sector undergoing rapid digitization, automation, and AI-driven credit analytics transformation. Banks that successfully deploy AI into underwriting, fraud detection, and customer acquisition can materially expand operating margin beyond the current 6.80%. The firm’s relatively modest scale (Market Cap $823M) means it must adopt technology efficiently or risk margin compression against larger tech-enabled peers.

The Bull Case

A disciplined GARP investor could justify ownership here on capital efficiency and forward earnings trajectory. A 16.00% ROIC is strong relative to the 4.10% ROE, implying the underlying invested capital base is generating solid returns even if accounting equity efficiency lags. The Piotroski F-Score of 6 indicates reasonable financial stability, not distress, and the drop from 17.2 P/E to 12.5 Forward P/E suggests earnings acceleration priced conservatively. At 1.2x book, investors are not paying a speculative premium, and the combination of a 6.80% operating margin and manageable 41.00% Debt/Equity gives this the profile of a steady, moderately levered regional lender with improving forward fundamentals.

The Bear Case

The bear case starts with the Altman Z-Score of 0.2 — that is deep distress territory and cannot be ignored in a leveraged financial institution. A 4.10% ROE is weak for a bank, and a 6.80% operating margin leaves little buffer if credit conditions deteriorate. Debt/Equity at 41.00% adds leverage risk, while the 1.1 PEG ratio signals growth is not strong enough to bail out valuation if earnings stumble. Institutional ownership at $14.50 and a 3.30% consensus rating suggest lukewarm professional conviction, and with Short % of Float at 0.00%, there’s no embedded squeeze dynamic to provide asymmetric upside.

Market Sentiment & Smart Money

Short Interest %

3.30%

Analyst Consensus

2.5

Average Analyst Price Target

$14.50

Institutional Ownership %

82.40%

1-Year Beta

0.91

Insider Buying % (6 Mo)

3.10%%

Distance to 52-Week High

96.70%

Distance to 52-Week Low

164.90%

EARNINGS SURPRISE %

50-DAY SMA

200-DAY SMA

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This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.