Why did the Bank of Queensland share price just hit a new 52-week low?

The regional bank stock has struggled today.

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Key points

  • The Bank of Queensland bottomed out at $5.78 on Thursday, marking a 2.7% tumble
  • It follows a rough period for both the bank and the broader banking sector
  • Not to mention, the bank's latest earnings appeared to disappoint the market

The Bank of Queensland Ltd (ASX: BOQ) share price tumbled to its lowest point in recent memory on Thursday. At its lowest point of the session, stock in the S&P/ASX 200 Index (ASX: XJO) bank was swapping hands for just $5.78.

Not only did that mark a new 52-week low, it's the lowest the stock has been since October 2020.

The Bank of Queensland share price has bounced slightly since posting its multi-year low. Right now, it's trading at $5.79 – 2.53% lower than its previous close.  

For comparison, the ASX 200 is down 0.39% right now.

Let's take a look at what might have been weighing on the Bank of Queensland share price lately.

What's going wrong for the Bank of Queensland share price?

The Bank of Queensland share price has had a bad run as of late. Here's how it's been performing:

Time passedBOQ share price movement
One week-7%
One month-9%
Year to date-14%
One year-26%
Five years-40%

That's a worrying breakdown for long-term investors. Though, much of it can be put down to recent happenings.

For instance, today's tumble might have a bit to do with recent volatility facing New York-listed peer First Republic Bank (NYSE: FRC). Stock in the US$1 billion bank plummeted 49% on Tuesday before posting another 30% fall overnight.

Its suffering followed news the bank experienced US$105 billion of deposit outflows in the first quarter amid March's 'banking crisis', which was spurred by liquidity issues.

The crisis itself also seemingly frightened Aussie investors, with the S&P/ASX 200 Financials Index (ASX: XFJ) falling 5% last month, likely dragging the Bank of Queensland share price down with it.

There is another major happening that appears to be behind the bank stock's recent slog, however.

Bank of Queensland's earnings appear to disappoint

Bank of Queensland dropped its first-half earnings last week, detailing a 98% tumble in statutory net profit after tax (NPAT), driven by a $60 million provision and a $200 million impairment.

Its cash earnings also slipped 4% to $256 million and its interim dividend was slashed 9% to 20 cents per share. Finally, the bank's operating expenses lifted 7%.

The stock initially rose on its earnings release before plunging 5% in the following session.

Looking further back, the bank's share price dumped 5.6% when it ousted its CEO in November and soared 11% when it released its financial year 2022 results in October.

Looking forward

Goldman Sachs is wary of Bank of Queensland shares considering the current economic landscape.

It says the bank has higher exposure to rate-sensitive housing than some of its ASX 200 peers, leaving it at greater risk of negative net interest margin (NIM) trends. The broker also noted inflation will likely lift the bank's expenses, while costs associated with its digital transformation and legacy technology could weigh heavier than expected.

It remains neutral on Bank of Queensland shares, slapping them with a $6.45 price target – a potential 11% upside.  

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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