Head to Head Survey: Banc of California (NYSE:BANC) versus American Business Bank (OTCMKTS:AMBZ)

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

Earnings & Valuation

This table compares Banc of California and American Business Bank”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banc of California	$1.00 billion	2.31	$126.89 million	$0.65	24.14
American Business Bank	$183.26 million	2.44	$43.28 million	$5.18	9.65

Banc of California has higher revenue and earnings than American Business Bank. American Business Bank is trading at a lower price-to-earnings ratio than Banc of California, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Banc of California has a beta of 0.69, indicating that its share price is 31% less volatile than the S&P 500. Comparatively, American Business Bank has a beta of 0.44, indicating that its share price is 56% less volatile than the S&P 500.

Institutional & Insider Ownership

86.9% of Banc of California shares are held by institutional investors. Comparatively, 9.9% of American Business Bank shares are held by institutional investors. 2.7% of Banc of California shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banc of California	0	4	8	0	2.67
American Business Bank	0	0	0	0	0.00

Banc of California presently has a consensus target price of $17.3333, suggesting a potential upside of 10.49%. Given Banc of California’s stronger consensus rating and higher probable upside, equities analysts clearly believe Banc of California is more favorable than American Business Bank.

Dividends

Banc of California pays an annual dividend of $0.40 per share and has a dividend yield of 2.5%. American Business Bank pays an annual dividend of $1.00 per share and has a dividend yield of 2.0%. Banc of California pays out 61.5% of its earnings in the form of a dividend. American Business Bank pays out 19.3% 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Banc of California	8.30%	7.37%	0.65%
American Business Bank	25.23%	N/A	N/A

Summary

Banc of California beats American Business Bank on 12 of the 16 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 American Business Bank

American Business Bank, a California-chartered bank, provides banking products and services to small and medium-sized firms, non-profits, business executives, and professionals in Southern California. The company offers credit and depository; treasury management; asset-based lending; SBA lending; international banking comprising money transfers, import and export commercial letters of credit, standby letters of credit, documentary and clean collections, and foreign currency exchange services; and consulting and referral services. It operates regional loan production offices located in North Orange County, Orange County, South Bay, San Fernando Valley, Riverside County, Inland Empire, and Long Beach. American Business Bank was incorporated in 1998 and is headquartered in Los Angeles, California.