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what it is
It is a California business bank that lends to small companies and holds their operating cash.
how it gets paid
Last year Heritage Commerce made $4M in revenue. commercial and industrial loans was the main engine at $1.6M, or 40% of sales.
why it's growing
Revenue grew 3.6% last year. revenue rose 203% vs. prior year to $3M.
what just happened
EPS hit $0.53 on revenue of $3M, even as the bigger story stayed the $13.00 takeover price.
At a glance
B+ balance sheet — decent shape, but not bulletproof
55/100 earnings predictability — expect surprises
18.4x trailing p/e — priced about right
4.3% dividend yield — cash in your pocket every quarter
$0.66 fy2024 eps est
xvary composite: 56/100 — below average
What they do
It is a California business bank that lends to small companies and holds their operating cash.
If you run a small business, you want a banker who knows your payroll week, not a call center. Heritage built that local trust with 355 employees serving business owners across its niche California market. The franchise was credible enough that CVB agreed to buy it for $811 million, or $13.00 per share.
How they make money
$4M
annual revenue · their business grew +3.6% last year
commercial and industrial loans
$1.6M
construction loans
$0.8M
sba loans
$0.6M
deposit accounts
$0.7M
other banking services
$0.3M
The products that matter
commercial lending
Commercial & Industrial Loans
$3.6B loan portfolio
This is the earnings engine. Management said it grew 14.9% in 2025. If credit quality slips here, the standalone story weakens and the deal story gets less comfortable.
core earnings engine
full-service banking
Heritage Bank of Commerce
$5.8B in total assets
This is what CVB is actually buying: a working regional bank with deposits, loans, and local relationships. The headline is the sale price. The object being sold is still a real bank.
the deal target
fee income
Non-interest Income
$25.4M · 13% of revenue
Fees help, but they are not carrying this franchise. Only $25.4M of revenue sits outside spread income. That tells you how little room there is to hide if bank fundamentals soften before closing.
secondary support
Key numbers
$13.00
deal price
This is the agreed per-share merger value, so your upside from $12.85 is just $0.15 unless the terms change.
5%
debt/capital
Long-term debt is only 5% of capital, which means leverage is not the main thing that can wreck this story.
4.3%
dividend yield
You are getting paid 4.3% a year while waiting, which matters when the merger spread itself is thin.
18.4x
trailing p/e
P/E → price-to-earnings ratio → so what: you are paying 18.4 times trailing profit for a bank already being acquired.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 60 / 100
- long-term debt $40M (5% of capital)
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for HTBK right now.
source: institutional data · return history unavailable
What just happened
beat estimates
EPS hit $0.53 on revenue of $3M, even as the bigger story stayed the $13.00 takeover price.
Quarterly revenue rose 203% vs. prior year to $3M, and EPS rose 121% to $0.53 based on the SEC filing data provided. That looks strong, but the stock now trades more like a merger stub than a normal bank.
$3M
revenue
$0.53
eps
n/a
n/a
the number that mattered
The number that matters is $13.00 because merger math now matters more than one quarter of bank earnings.
source: company earnings report, 2026
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What could go wrong
The risk is specific, not theoretical: you are taking standalone regional-bank exposure for a signed $13.00 exit that has not happened yet.
high
Merger break risk
The agreed transaction values Heritage Commerce at $811M and $13.00 per share. If regulators push back or either side walks, the stock stops behaving like a near-cash event and goes back to trading on standalone bank fundamentals.
Your main source of upside is the deal spread. If the deal breaks, the spread disappears and the thesis goes with it.
med
Credit deterioration in the $3.6B loan book
This bank earns most of its money from lending. If borrower quality weakens, earnings take a hit and the asset being acquired gets less attractive at the same time.
When 87% of revenue comes from net interest income, asset quality is not a footnote. It is the business.
med
Timing drag
A 15-cent gap to the $13.00 deal price does not leave much room for delay. Even if the merger closes, extra months of waiting can turn a tidy-looking spread into an unimpressive annualized return.
This is the part event-driven screens hide: a positive outcome can still be a mediocre use of your time.
The combined risk picture is simple: you are risking standalone regional-bank exposure for a 15-cent spread to the agreed $13.00 price.
source: institutional data · regulatory filings · risk analysis
Pay attention to
merger
Expected close in the first half of 2026
This is the whole calendar. If you own HTBK, you care less about five-year strategy than whether the closing date stays on track.
credit
Any sign the loan book is getting worse
The bank has $3.6B in loans. If credit quality weakens before closing, the market will react before the paperwork does.
income mix
Net interest income staying dominant for the right reasons
$170.3M of the $195.7M revenue base comes from net interest income. If that engine softens, there is only $25.4M of non-interest income to soften the blow.
spread
Whether the 15-cent deal gap narrows or widens
A tighter spread usually signals confidence in closing. A wider one is the market saying the easy part of this trade may already be over.
Analyst rankings
earnings predictability
55 / 100
This score sits in the middle of the pack. in human-speak, analysts do not view HTBK's earnings stream as especially smooth or especially chaotic.
balance sheet grade
B+
Good enough to matter, not strong enough to be the story. For this stock, merger terms still outrank bank quality in the market's priority list.
source: institutional data
Institutional activity
institutional ownership data for HTBK is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$13
current price
n/a
target midpoint · n/a from current
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