2019: A Strong Year For Market, Positive For Local Stocks

Jan 2, 2020

Investors begin the New Year following a very strong stock market in 2019. For the year, the Dow Jones Industrial Average was up 22%, while the broader S&P 500 rose 29%. For investors in Hawaii’s biggest publicly-held companies, returns have been positive this year—but in many cases, not as high as the overall market.   

Financial stocks were some of the stars of the 2019 market, and that’s true for local companies as well.

All local banks enjoyed positive years — up sharply from their lows of the 4th quarter of 2018 — and most advanced relatively steadily through the year, without the volatility of the previous year.

Going by its annual revenue of $723 million, the largest locally-based bank is First Hawaiian. Its share price rose more than 28% for the year.

Next in size is Bank of Hawaii — its annual revenue is 638 million dollars, and its stock was the biggest local gainer last yea, up more than 41% in 2019.

American Savings Bank is part of Hawaiian Electric Industries—and does not trade as a separate stock.

Central Pacific is less than a third of the size of First Hawaiian---and rose more than 21% for the year.

Territorial Bankcorp is the smallest publicly held local bank—its stock also gained 21% in 2019.

While each bank has its individual strengths and weaknesses, the group of local publicly held banks is consistent with the broader industry trend of higher earnings and share prices in 2019—with a fourth quarter that produced some of the best returns of the year.

More broadly, if you look at a chart of the major U.S. stock indices for 2019, you’ll see a similar overall pattern: a fairly steady move higher—with dips along the way in May and August---and a smaller one in October.

For most publicly-held companies based in Hawaii, the year was positive, but not necessarily as smooth a climb—or as much of an increase.

Hawaiian Electric was one of the biggest local gainers in 2019—outpacing the Dow and the S&P with a gain of 28%, starting 2020 near its 52-week high.

Matson rose 27%—also closing the year pretty near its 52-week high—and up a third from its low point.

Alexander and Baldwin—the former parent of Matson—saw its recent peak in October—and fell about 17-percent by year end—though still closed the year with a 14% gain.

Hawaiian Holdings is the parent company of Hawaiian Airlines—and its shares have climbed by 20% since September—they closed the year up 11%, but short of the levels they saw in January.

All of these companies have more than a billion dollars in market capitalization—the total value of all the company’s shares.

One much smaller neighbor island company of note—Maui Land and Pineapple’s market cap is a little less than a quarter of a billion dollars---and its shares closed 2019 with a gain of more than 13%.