Banc of California (NYSE:BANC) versus California Business Bank (OTCMKTS:CABB) Critical Review

Banc of California (NYSE:BANC) and California Business Bank (OTCMKTS:CABB) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, profitability, dividends, institutional ownership, valuation, earnings and analyst recommendations.

Profitability

This table compares Banc of California and California Business Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banc of California	13.58%	9.25%	0.81%
California Business Bank	N/A	N/A	N/A

Insider & Institutional Ownership

86.9% of Banc of California shares are held by institutional investors. 2.8% of Banc of California shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

Banc of California has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, California Business Bank has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Banc of California and California Business Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banc of California	0	1	7	1	3.00
California Business Bank	0	0	0	0	0.00

Banc of California presently has a consensus target price of $22.31, indicating a potential upside of 19.00%. Given Banc of California’s stronger consensus rating and higher possible upside, equities analysts clearly believe Banc of California is more favorable than California Business Bank.

Earnings and Valuation

This table compares Banc of California and California Business Bank”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banc of California	$1.82 billion	1.59	$228.97 million	$1.31	14.31
California Business Bank	N/A	N/A	N/A	N/A	N/A

Banc of California has higher revenue and earnings than California Business Bank.

Summary

Banc of California beats California Business Bank on 11 of the 11 factors compared between the two stocks.

About Banc of California

Banc of California, Inc. operates as the bank holding company for Banc of California that provides various banking products and services in California. The company offers deposit products, such as checking, savings, money market, demand, and time deposits; certificates of deposit; retirement accounts; and safe deposit boxes. It also provides real estate loans to professional developers and real estate investors for the acquisition, construction, refinancing, renovation, and on-going operation of commercial real estate properties; commercial real estate mortgage, residential real estate mortgage, and real estate construction and land loans; commercial loans and leases, such as equipment finance, other asset-based, venture capital, secured business, warehouse, and other lending services; small business administration loans; and consumer loans comprising personal, auto, and other loans, as well as home equity and revolving lines of credit. In addition, the company offers international banking, multi-state deposit, and asset and investment management services, as well as cash and treasury management services; and online, mobile, remote deposit, and telephone banking services. It serves small and middle-market businesses, venture capital firms, non-profit organizations, business owners, entrepreneurs, professionals, and high-net worth individuals. Banc of California, Inc. was founded in 1941 and is headquartered in Los Angeles, California.

About California Business Bank

California Business Bank provides various financial products and services for small businesses and entrepreneurs. The company offers various personal and business deposit products; and business and commercial loans comprising SBA, commercial and industrial, and commercial real estate loans. It also provides online and mobile banking, mobile deposit, bill pay, and other services. The company was founded in 2005 and is headquartered in Irvine, California.