Head-To-Head Analysis: Sierra Bancorp (NASDAQ:BSRR) vs. Bay Commercial Bank (NASDAQ:BCML)

Bay Commercial Bank (NASDAQ:BCML) and Sierra Bancorp (NASDAQ:BSRR) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, risk, dividends and institutional ownership.

Earnings & Valuation

This table compares Bay Commercial Bank and Sierra Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bay Commercial Bank	$138.09 million	2.23	$23.61 million	$2.10	13.42
Sierra Bancorp	$203.87 million	2.21	$40.56 million	$2.87	11.83

Sierra Bancorp has higher revenue and earnings than Bay Commercial Bank. Sierra Bancorp is trading at a lower price-to-earnings ratio than Bay Commercial Bank, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Bay Commercial Bank and Sierra Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bay Commercial Bank	16.51%	7.04%	0.89%
Sierra Bancorp	19.70%	11.17%	1.08%

Volatility & Risk

Bay Commercial Bank has a beta of 0.34, meaning that its share price is 66% less volatile than the S&P 500. Comparatively, Sierra Bancorp has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500.

Institutional & Insider Ownership

66.2% of Bay Commercial Bank shares are held by institutional investors. Comparatively, 55.4% of Sierra Bancorp shares are held by institutional investors. 6.5% of Bay Commercial Bank shares are held by company insiders. Comparatively, 11.9% of Sierra Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Bay Commercial Bank pays an annual dividend of $1.20 per share and has a dividend yield of 4.3%. Sierra Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 2.9%. Bay Commercial Bank pays out 57.1% of its earnings in the form of a dividend. Sierra Bancorp pays out 34.8% 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. Bay Commercial Bank has increased its dividend for 3 consecutive years and Sierra Bancorp has increased its dividend for 2 consecutive years. Bay Commercial Bank is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Bay Commercial Bank and Sierra Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bay Commercial Bank	0	1	2	0	2.67
Sierra Bancorp	0	2	2	0	2.50

Bay Commercial Bank currently has a consensus target price of $31.50, indicating a potential upside of 11.74%. Sierra Bancorp has a consensus target price of $34.50, indicating a potential upside of 1.65%. Given Bay Commercial Bank’s stronger consensus rating and higher probable upside, analysts clearly believe Bay Commercial Bank is more favorable than Sierra Bancorp.

Summary

Sierra Bancorp beats Bay Commercial Bank on 9 of the 16 factors compared between the two stocks.

About Bay Commercial Bank

BayCom Corp operates as the bank holding company for United Business Bank that provides various financial services to small and mid-sized businesses, service professionals, and individuals. The company provides demand, savings, money market, and time deposit accounts. It offers commercial and multifamily real estate loans, including owner-occupied and investor real estate loans; commercial and industrial loans, such as equipment loans and working capital lines of credit; small business administration loans; construction and land loans; agriculture-related loans; and consumer loans comprising installment loans, unsecured and secured personal lines of credit, and overdraft protection. In addition, the company provides online and mobile banking, automated teller machine, remote deposit capture, night depository, courier, direct deposit, treasury management, wire transfer, automated clearing house, debit cards, cashier's and travelers checks, letters of credit, lockbox, positive pay, reverse positive pay, and account reconciliation services, as well as zero balance accounts and sweep accounts, including loan sweep. It operates through a network of full-service banking branches in Northern and Southern California; Las Vegas, Nevada; Denver, Colorado; Custer, Delta, and Grand counties, Colorado; and Seattle, Washington and Central New Mexico. The company was formerly known as Bay Commercial Bank and changed its name to BayCom Corp in January 2017. BayCom Corp was incorporated in 2004 and is headquartered in Walnut Creek, California.

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. It accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. The company's loan products include agricultural, commercial, consumer, real estate, construction, and mortgage loans. It 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. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.