Sierra Bancorp (NASDAQ:BSRR) and Bank of Hawaii (NYSE:BOH) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, institutional ownership, profitability and earnings.
Institutional & Insider Ownership
54.7% of Sierra Bancorp shares are held by institutional investors. Comparatively, 73.8% of Bank of Hawaii shares are held by institutional investors. 10.3% of Sierra Bancorp shares are held by company insiders. Comparatively, 2.1% of Bank of Hawaii shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This is a summary of recent recommendations and price targets for Sierra Bancorp and Bank of Hawaii, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Bank of Hawaii||1||1||1||0||2.00|
Sierra Bancorp presently has a consensus price target of $29.00, indicating a potential upside of 64.96%. Bank of Hawaii has a consensus price target of $76.00, indicating a potential upside of 34.20%. Given Sierra Bancorp’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Sierra Bancorp is more favorable than Bank of Hawaii.
This table compares Sierra Bancorp and Bank of Hawaii’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Bank of Hawaii||23.91%||13.98%||0.99%|
Volatility and Risk
Sierra Bancorp has a beta of 1.18, suggesting that its stock price is 18% more volatile than the S&P 500. Comparatively, Bank of Hawaii has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500.
Earnings & Valuation
This table compares Sierra Bancorp and Bank of Hawaii’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Sierra Bancorp||$134.42 million||1.99||$35.96 million||$2.33||7.55|
|Bank of Hawaii||$770.73 million||2.94||$225.91 million||$5.56||10.19|
Bank of Hawaii has higher revenue and earnings than Sierra Bancorp. Sierra Bancorp is trading at a lower price-to-earnings ratio than Bank of Hawaii, indicating that it is currently the more affordable of the two stocks.
Sierra Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 4.6%. Bank of Hawaii pays an annual dividend of $2.68 per share and has a dividend yield of 4.7%. Sierra Bancorp pays out 34.3% of its earnings in the form of a dividend. Bank of Hawaii pays out 48.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Sierra Bancorp has raised its dividend for 7 consecutive years and Bank of Hawaii has raised its dividend for 4 consecutive years.
Bank of Hawaii beats Sierra Bancorp on 9 of the 16 factors compared between the two stocks.
About Sierra Bancorp
Sierra Bancorp operates as the bank holding company for Bank of the Sierra that provides retail and commercial banking services to individuals and businesses in California. The company accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. Its loan products include real estate, commercial, mortgage warehouse, agricultural, industrial, and consumer loans. The company also offers automated teller machines; electronic point-of-sale payment alternatives; online and automated telephone banking services; and remote deposit capture and automated payroll services for business customers. As of December 31, 2018, it operated 40 full service branches, an online branch, an agricultural credit center, and an SBA lending unit. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.
About Bank of Hawaii
Bank of Hawaii Corporation operates as the bank holding company for Bank of Hawaii that provides financial products and services in Hawaii, Guam, and other Pacific Islands. It operates through four segments: Retail Banking, Commercial Banking, Investment Services and Private Banking, and Treasury and Other. The Retail Banking segment offers financial products and services to consumers and small businesses. It offers checking, savings, and time deposit accounts; loan and lease products, including residential mortgage loans, home equity lines of credit, automobile loans and leases, personal lines of credit, installment loans, small business loans and leases, and credit cards; and retail insurance products. This segment provides its products and services through 69 branch locations and 382 ATMs in Hawaii and the Pacific Islands, as well as through a customer service center, and online and mobile banking. The Commercial Banking segment's product lines comprise corporate banking, commercial real estate loans, commercial lease financing, auto dealer financing, and deposit products. It offers commercial lending and deposit products to middle-market and large companies, and government entities; and commercial real estate mortgages to investors, developers, and builders. This segment also provides international banking and merchant services. The Investment Services and Private Banking segment offers private and international client banking, trust, investment management, and institutional investment advisory services for individuals and families, high-net-worth individuals, corporations, government entities, and foundations. This segment also provides brokerage offering equities, mutual funds, life insurance, and annuity products. The Treasury and Other segment offers corporate asset and liability management services, such as interest rate risk management and foreign exchange services. Bank of Hawaii Corporation was founded in 1897 and is headquartered in Honolulu, Hawaii.
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