Analyzing CBTX (NASDAQ:CBTX) and Camden National (NASDAQ:CAC)

CBTX (NASDAQ:CBTX) and Camden National (NASDAQ:CAC) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, risk, earnings, dividends and institutional ownership.

Insider and Institutional Ownership

39.3% of CBTX shares are held by institutional investors. Comparatively, 68.8% of Camden National shares are held by institutional investors. 26.0% of CBTX shares are held by insiders. Comparatively, 2.6% of Camden National shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares CBTX and Camden National’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CBTX 25.69% 7.01% 0.97%
Camden National 35.92% 13.76% 1.44%

Risk and Volatility

CBTX has a beta of 1.01, suggesting that its share price is 1% more volatile than the S&P 500. Comparatively, Camden National has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.

Dividends

CBTX pays an annual dividend of $0.52 per share and has a dividend yield of 2.0%. Camden National pays an annual dividend of $1.44 per share and has a dividend yield of 3.0%. CBTX pays out 49.1% of its earnings in the form of a dividend. Camden National pays out 36.5% 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. CBTX has increased its dividend for 1 consecutive years and Camden National has increased its dividend for 2 consecutive years. Camden National is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares CBTX and Camden National’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CBTX $153.47 million 4.26 $26.36 million $1.06 25.09
Camden National $207.69 million 3.44 $59.49 million $3.95 12.11

Camden National has higher revenue and earnings than CBTX. Camden National is trading at a lower price-to-earnings ratio than CBTX, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations for CBTX and Camden National, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CBTX 0 2 0 0 2.00
Camden National 0 1 1 0 2.50

CBTX presently has a consensus price target of $28.00, indicating a potential upside of 5.26%. Camden National has a consensus price target of $52.00, indicating a potential upside of 8.74%. Given Camden National’s stronger consensus rating and higher probable upside, analysts clearly believe Camden National is more favorable than CBTX.

Summary

Camden National beats CBTX on 13 of the 17 factors compared between the two stocks.

CBTX Company Profile

CBTX, Inc. operates as a bank holding company, which engages in the provision of commercial banking solutions to local small and mid-sized businesses and professionals. The company was founded by J. Pat Parsons on January 26, 2007 and is headquartered in Houston, TX.

Camden National Company Profile

Camden National Corp. is a bank holding company, which engages in the provision of financial services to individuals and companies through its subsidiary, Camden National Bank. Its services includes lending, checking, savings, time deposits, cash management, brokerage, wealth management, and trust. The company was founded in 1984 and is headquartered in Camden, ME.

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