Heritage Financial Corporation
- Open
- 30.96
- Day high
- 31.10
- Day low
- 30.39
- Prev close
- 31.25
- Volume
- 399K
- Mkt cap
- $1.3B
- P/E (TTM)
- 14.8
- EPS (TTM)
- $2.06
- P/B
- 1.1
- P/S
- 3.6
- Yield
- 3.15%
- Per share
- $0.96
- ▼Insiders net selling -$259K over the last 3 months (0 open-market buys, 3 sales)
- 🏛Institutions accumulating (13F)
Heritage Financial Corporation (HFWA) is a Financial Services company listed on NASDAQ. The stock is up 22% over the past year. Over the trailing 3 months, insiders filed 0 open-market buys and 3 sales (SEC Form 4).
Heritage Financial Corporation (HFWA) financials & analyst ratings
Fundamentals (TTM)
Analyst consensus · 2 analysts
Source: exchange market data + company filings. Figures are trailing-twelve-month or as most recently reported. For informational purposes only — not investment advice.
HFWA earnings date, history & EPS estimates
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| Apr 23, 2026 | $0.57 | $0.59 | +3.5% | $78M | -3.2% |
| Jan 22, 2026 | $0.57 | $0.66 | +15.8% | $87M | +7.4% |
| Oct 23, 2025 | $0.56 | $0.56 | +0.0% | $66M | -0.8% |
| Jul 24, 2025 | $0.50 | $0.53 | +6.0% | $57M | -13.5% |
| Apr 24, 2025 | $0.46 | $0.49 | +6.5% | $58M | -6.7% |
| Jan 23, 2025 | $0.45 | $0.51 | +13.3% | $57M | -5.2% |
| Oct 24, 2024 | $0.41 | $0.33 | -19.5% | $55M | -5.7% |
| Jul 25, 2024 | $0.40 | $0.41 | +2.5% | $56M | -3.3% |
| Apr 25, 2024 | $0.41 | $0.40 | -2.4% | $71M | +19.3% |
| Jan 25, 2024 | $0.47 | $0.47 | +0.0% | $71M | +14.6% |
| Oct 19, 2023 | $0.43 | $0.51 | +18.6% | $62M | -0.9% |
| Jul 20, 2023 | $0.48 | $0.48 | +0.0% | $63M | -3.2% |
HFWA insider trading activity (SEC Form 4)
| Date | Insider | Type | Shares | Price |
|---|---|---|---|---|
| Jun 17, 2026 | Dryer Trevor D.director | Grant | 1,999 | — |
| Jun 17, 2026 | VANCE BRIAN Ldirector | Grant | 1,999 | — |
| Jun 17, 2026 | Saunders Karen Rdirector | Grant | 1,999 | — |
| Jun 17, 2026 | Giacobbe Gail B.director | Grant | 1,999 | — |
| Jun 17, 2026 | Ellwanger Kimberly Tdirector | Grant | 1,999 | — |
| Jun 17, 2026 | Allan Scott Tantondirector | Grant | 1,999 | — |
| Jun 17, 2026 | CHARNESKI BRIANdirector | Grant | 1,999 | — |
| Jun 17, 2026 | Watson Anndirector | Grant | 1,999 | — |
| Jun 17, 2026 | Rivera Frederick Bdirector | Grant | 1,999 | — |
| Jun 17, 2026 | LYON JEFFREY Sdirector | Grant | 1,999 | — |
| Jun 15, 2026 | Chalfant Tonyofficer: EVP Chief Credit Officer | Option | 1,316 | $28.44 |
| Jun 15, 2026 | Curran Amy E.officer: EVP Director Commercial Lend | Tax | 71 | $28.44 |
| Jun 15, 2026 | Curran Amy E.officer: EVP Director Commercial Lend | Option | 576 | $28.44 |
| Jun 15, 2026 | Chalfant Tonyofficer: EVP Chief Credit Officer | Tax | 135 | $28.44 |
| Jun 10, 2026 | Hinson Donaldofficer: EVPand Chief Financial Officer | Sell | 3,842 | $28.37 |
Source: HFWA SEC Form 4 filings, latest Jun 17, 2026. For informational purposes only — not investment advice.
See the full HFWA insider & 13F page →Heritage Financial Corporation company profile
Overview
Heritage Financial Corporation (NASDAQ:HFWA) is a regional bank holding company founded in 1927 and headquartered in Olympia, Washington. The company operates through its subsidiary Heritage Bank, providing traditional banking services across Washington and Oregon through a network of 49 banking offices. Heritage Financial went public in 1998 after converting from mutual holding company structure and has established itself as a community-focused regional bank serving small and medium-sized businesses and individual customers in the Pacific Northwest.
Business
Heritage Financial operates in the regional banking industry, which sits between large national banks and small community banks in terms of scale and geographic footprint. Regional banks like Heritage typically focus on specific geographic markets where they can develop deep community relationships and local market expertise. Core Banking Services: Heritage Bank offers traditional commercial banking products including various deposit accounts (checking, savings, money market accounts, and certificates of deposit), commercial and industrial loans, commercial real estate financing, residential mortgages, and consumer lending. The bank also provides Small Business Administration (SBA) guaranteed loans, which are government-backed loans that help small businesses access capital with reduced risk to the lender. Trust and Wealth Services: Beyond traditional banking, Heritage offers trust services and investment advisory services, helping customers manage estates, trusts, and investment portfolios. This provides higher-margin fee income compared to basic banking services. Geographic Focus: The bank operates primarily along the Interstate 5 corridor in Washington and Oregon, with recent expansion into Idaho through a Boise office. This geographic concentration allows Heritage to develop expertise in local markets, understand regional economic conditions, and build strong customer relationships within their communities. The bank's loan portfolio is diversified across commercial and industrial loans (business lending), commercial real estate (office buildings, retail centers, industrial properties), residential real estate, construction and development loans, and consumer loans. This diversification helps manage risk across different economic sectors and loan types.
Revenue model
Heritage Financial generates revenue primarily through net interest income - the difference between what it earns on loans and investments versus what it pays on deposits and borrowings. This is the fundamental banking business model where banks act as financial intermediaries, taking deposits from savers and lending that money to borrowers at higher interest rates. The bank's paying customers include small and medium-sized businesses seeking commercial loans, real estate developers and investors needing construction or commercial real estate financing, individual consumers requiring mortgages or personal loans, and depositors who provide the funding base through checking accounts, savings accounts, and certificates of deposit. Secondary Revenue Sources: Heritage also generates fee income from trust services, deposit account fees, loan origination fees, and SBA loan sales. When the bank originates SBA loans, it can sell the government-guaranteed portion to investors while retaining the servicing rights, generating both immediate fee income and ongoing servicing revenue. Margin Influencing Factors: Several factors significantly impact Heritage's profitability. Rising interest rates generally benefit banks by allowing them to charge higher rates on new loans faster than deposit costs increase, expanding net interest margins. Conversely, falling rates compress margins as loan yields decline while deposit costs remain sticky. Economic growth in the Pacific Northwest drives loan demand and reduces credit losses, while economic downturns increase loan defaults and reduce lending opportunities. Competition from larger banks and credit unions pressures both loan pricing and deposit rates. Regulatory changes affecting capital requirements or lending standards can impact profitability, while operational efficiency improvements through technology investments or expense management directly flow to the bottom line.
Competitive moat
Heritage Financial operates with a modest competitive moat primarily built around local market relationships and geographic positioning. The bank's strongest defensive characteristics include its established presence in Pacific Northwest markets where management has developed deep knowledge of local economic conditions, business networks, and customer relationships that take years for competitors to replicate. Relationship Banking Advantage: Heritage's focus on small and medium-sized businesses creates switching costs for customers who value personalized service and local decision-making that large national banks often cannot provide. These business relationships often encompass multiple services including deposits, loans, and cash management, making customer defection more difficult. Regulatory Barriers: Banking remains a regulated industry with significant barriers to entry including capital requirements, regulatory approvals for new charters, and compliance costs that favor established players. However, these barriers protect all existing banks rather than providing Heritage with unique advantages. Competitive Vulnerabilities: Heritage faces significant competitive threats from multiple directions. Large national banks possess superior technology platforms, can offer more competitive pricing due to lower funding costs, and have greater resources for marketing and customer acquisition. Credit unions often provide more attractive rates to consumers due to their tax-exempt status. Fintech companies are increasingly capturing market share in consumer lending and payments. Additionally, Heritage's relatively small size limits its ability to serve larger commercial customers or compete for major lending relationships, constraining growth opportunities in its core markets. The bank's moat is therefore relatively narrow and primarily defensive, relying on customer inertia and local relationships rather than sustainable competitive advantages that would prevent market share erosion over time.
Risks & safety
Heritage Financial demonstrates moderate financial safety with adequate capitalization but limited financial flexibility typical of regional banks. • Solvency Position: Strong with $863 million in shareholders' equity against $7.1 billion in total assets. Total debt-to-equity ratio of 0.47x indicates conservative leverage. No immediate solvency concerns. • Cash Generation: Positive operating cash flow of $67 million annually and free cash flow of $61 million in 2024. No cash burn issues, though cash flows can be volatile due to banking operations. • Valuation Metrics: Trading at 19.5x trailing earnings and 0.98x book value, suggesting reasonable valuation relative to tangible assets. Graham number of 26.6 indicates potential undervaluation. • Credit Quality: Excellent with non-accrual loans at only 0.08% of total loans ($4 million out of $5 billion loan portfolio). Net charge-offs minimal at $27,000 quarterly. • Capital Ratios: Well-capitalized under regulatory standards with strong Tier 1 capital ratios providing buffer against potential losses. • Interest Rate Risk: Moderate exposure to margin compression if rates fall rapidly, though recent quarters showed margin expansion capability.
Recent development
Over the past few years, Heritage Financial has executed several strategic initiatives focused on organic growth and operational efficiency. The bank has pursued an aggressive team expansion strategy, hiring commercial banking teams from competitors to enter new markets and expand market share. This included establishing operations in Boise, Idaho, and strengthening presence in Portland, Oregon markets. Leadership Transition: The company completed a planned CEO succession with Bryan McDonald becoming CEO of Heritage Bank in July 2024, while Jeff Deuel will retire as holding company CEO in May 2025. This transition was planned since mid-2022 and represents continuity in strategic direction. Balance Sheet Optimization: Heritage has actively managed its investment portfolio through strategic sales and purchases, selling lower-yielding securities and reinvesting in higher-yielding assets to improve net interest margins. The bank reduced its securities portfolio from over $2 billion to under $1.5 billion while redeploying funds into higher-yielding loans. Expense Management: The company implemented significant cost reduction measures, reducing its non-interest expense run rate from $171 million to approximately $162 million annually through contract rationalization, elimination of management layers, and operational streamlining. The bank also exited its retail mortgage platform to focus on relationship-based commercial lending. Technology and Efficiency: Heritage has invested in technology infrastructure while maintaining expense discipline, targeting a quarterly expense run rate of $40-41 million. The bank has also been opportunistic with share repurchases, buying back approximately 566,000 shares during 2024 when trading below book value.
HFWA company profile · for informational purposes only — not investment advice.
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