| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 49.64 | 255 |
| Intrinsic value (DCF) | 15.13 | 8 |
| Graham-Dodd Method | 13.66 | -2 |
| Graham Formula | 29.68 | 112 |
OP Bancorp (NASDAQ: OPBK) is the holding company for Open Bank, a regional financial institution serving businesses and consumers primarily in California and Texas. Founded in 2005 and headquartered in Los Angeles, Open Bank specializes in commercial real estate lending, SBA loans, and trade financing, with a strong focus on the Korean-American community and small-to-medium enterprises (SMEs). The bank operates nine full-service branches and four loan production offices across key markets, including Los Angeles, Santa Clara, and Dallas-Fort Worth. OP Bancorp differentiates itself through tailored financial solutions, including cash management services, mobile banking, and niche lending programs. With a market cap of approximately $184 million, the bank maintains a conservative balance sheet, reflected in its low beta (0.629) and solid liquidity ($135M in cash). Its revenue mix emphasizes commercial banking, contributing to stable net income ($21.1M in latest reporting). As a community-focused player in the competitive regional banking sector, OP Bancorp leverages its multicultural expertise and agile service model to capture growth in underserved markets.
OP Bancorp presents a niche investment opportunity in the regional banking sector, with strengths in commercial lending and a focused demographic strategy. The bank’s low beta suggests relative stability compared to broader financial markets, while its 3.4% dividend yield (based on $0.48 annual payout) offers income appeal. However, its small scale ($183M market cap) and concentration in California expose it to regional economic risks, including commercial real estate volatility. Revenue growth is modest ($79.3M TTM), but efficient operations (26.6% net margin) and strong cash flow ($31.3M operating cash flow) support capital retention. Investors should weigh its specialized market positioning against limited geographic diversification and competitive pressures from larger peers.
OP Bancorp’s competitive advantage lies in its targeted approach to multicultural banking, particularly serving Korean-American businesses—a segment often overlooked by larger regional banks. Its commercial real estate and SBA lending expertise allows for higher-margin niche lending, while its lean branch network (9 locations) keeps overhead low. However, the bank faces intense competition from both larger regional players (e.g., PacWest Bancorp) and community banks with similar ethnic focus (e.g., Hanmi Financial). OPBK’s digital offerings (mobile banking, remote deposit capture) are table stakes but lack the sophistication of tech-forward competitors. Its Texas expansion (Carrollton branch) provides growth optionality, but market penetration remains limited. Capital efficiency is a strength (ROE ~11% based on $21.1M net income), though its loan portfolio’s reliance on California CRE (~60% of total loans per filings) introduces concentration risk. The bank’s sub-$1B asset size restricts economies of scale, making cost control critical as it competes for deposits in a rising-rate environment.