Financial Analysis: West Bancorporation (WTBA) vs. The Competition

West Bancorporation (NASDAQ:WTBA) is one of 919 publicly-traded companies in the “Banks” industry, but how does it weigh in compared to its competitors? We will compare West Bancorporation to related companies based on the strength of its profitability, risk, dividends, valuation, earnings, analyst recommendations and institutional ownership.

Institutional & Insider Ownership

44.3% of West Bancorporation shares are held by institutional investors. Comparatively, 48.0% of shares of all “Banks” companies are held by institutional investors. 4.6% of West Bancorporation shares are held by insiders. Comparatively, 9.8% of shares of all “Banks” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares West Bancorporation and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
West Bancorporation	$106.60 million	$32.56 million	13.25
West Bancorporation Competitors	$32.38 billion	$2.42 billion	17.48

West Bancorporation’s competitors have higher revenue and earnings than West Bancorporation. West Bancorporation is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of recent ratings and price targets for West Bancorporation and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
West Bancorporation	0	3	1	0	2.25
West Bancorporation Competitors	7465	30196	27762	1465	2.35

West Bancorporation presently has a consensus target price of $29.00, suggesting a potential downside of 6.84%. As a group, “Banks” companies have a potential upside of 13.55%. Given West Bancorporation’s competitors stronger consensus rating and higher probable upside, analysts plainly believe West Bancorporation has less favorable growth aspects than its competitors.

Profitability

This table compares West Bancorporation and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
West Bancorporation	19.83%	16.09%	1.09%
West Bancorporation Competitors	15.64%	9.43%	0.93%

Dividends

West Bancorporation pays an annual dividend of $1.04 per share and has a dividend yield of 3.3%. West Bancorporation pays out 44.3% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 9.1% and pay out 28.9% of their earnings in the form of a dividend. West Bancorporation lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Risk and Volatility

West Bancorporation has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500. Comparatively, West Bancorporation’s competitors have a beta of 0.61, indicating that their average share price is 39% less volatile than the S&P 500.

Summary

West Bancorporation competitors beat West Bancorporation on 11 of the 15 factors compared.

About West Bancorporation

West Bancorporation, Inc. operates as the financial holding company provides community banking and trust services to individuals and small- to medium-sized businesses in the United States. It offers deposit services, including checking, savings, and money market accounts, as well as time certificates of deposit. The company also provides loan products comprising commercial real estate loans, construction and land development loans, commercial lines of credit, and commercial term loans; consumer loans, including loans extended to individuals for household, family, and other personal expenditures not secured by real estate; and 1-4 family residential mortgages and home equity loans. In addition, it offers online and mobile banking, treasury management services including cash management, client-generated automated clearing house transactions, remote deposit, and fraud protection services; merchant credit card processing and corporate credit cards; and administration of estates, conservatorships, personal trusts, and agency accounts. The company was founded in 1893 and is headquartered in West Des Moines, Iowa.