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Assessing OceanFirst Financial (OCFC) Valuation After Recent Share Price Weakness

Simply Wall St · 5d ago

Why OceanFirst Financial is on investors’ radar

OceanFirst Financial (OCFC) has drawn attention after recent share price pressure, with the stock showing negative returns over the past week, month, and past 3 months, prompting closer scrutiny of its current valuation.

See our latest analysis for OceanFirst Financial.

While the share price is down 11.5% over the past month and 3.3% year to date, the 1 year total shareholder return of 0.3% and 5 year total shareholder return of 5.2% suggest only modest longer term momentum. Recent weakness hints at a shift in sentiment around risk and growth expectations at the current US$17.26 share price.

If OceanFirst’s recent pullback has you thinking about where else capital could work, this might be a good moment to look beyond banks and check out fast growing stocks with high insider ownership.

So with OceanFirst posting annual revenue of US$378.6m, net income of US$74.9m and trading at US$17.26, is the current discount hinting at value or is the market already baking in future growth?

Most Popular Narrative: 20.3% Undervalued

With OceanFirst Financial’s fair value in the widely followed narrative sitting above the recent US$17.26 close, the gap raises clear questions about what the market is missing.

Ongoing digital initiatives and technology investments, including fintech partnerships, are enhancing operating leverage by reducing the incremental cost to serve and driving engagement with younger, tech-savvy demographics, which is potentially increasing fee-based income and improving net margins over time.

Read the complete narrative.

Curious what kind of revenue path and profit margins are baked into that higher fair value, and how future earnings per share and share count factor in? The narrative lays out a full earnings roadmap, links it to a specific P/E level a few years from now, and then discounts everything back using a defined required return. The result is a fair value that sits meaningfully above today’s share price, grounded in detailed forecasts rather than headlines.

Result: Fair Value of $21.67 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this hinges on commercial loan growth and deposit gathering keeping pace, and any stumble in those areas or a turn in credit quality could quickly challenge that upside story.

Find out about the key risks to this OceanFirst Financial narrative.

Build Your Own OceanFirst Financial Narrative

If you look at the numbers and come to a different conclusion, or simply prefer your own work, you can build a custom view in just a few minutes, starting with Do it your way.

A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding OceanFirst Financial.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.