Red River Bancshares (NASDAQ:RRBI – Get Free Report) and California BanCorp (NASDAQ:BCAL – Get Free Report) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, risk and dividends.
Volatility and Risk
Red River Bancshares has a beta of 0.41, indicating that its stock price is 59% less volatile than the S&P 500. Comparatively, California BanCorp has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.
Valuation and Earnings
This table compares Red River Bancshares and California BanCorp”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Red River Bancshares | $127.40 million | 4.68 | $42.76 million | $6.68 | 13.55 |
| California BanCorp | $237.07 million | 2.63 | $63.06 million | $1.83 | 10.60 |
California BanCorp has higher revenue and earnings than Red River Bancshares. California BanCorp is trading at a lower price-to-earnings ratio than Red River Bancshares, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Red River Bancshares and California BanCorp, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Red River Bancshares | 0 | 3 | 1 | 0 | 2.25 |
| California BanCorp | 0 | 1 | 3 | 1 | 3.00 |
Red River Bancshares currently has a consensus target price of $80.50, indicating a potential downside of 11.08%. California BanCorp has a consensus target price of $20.67, indicating a potential upside of 6.57%. Given California BanCorp’s stronger consensus rating and higher probable upside, analysts plainly believe California BanCorp is more favorable than Red River Bancshares.
Dividends
Red River Bancshares pays an annual dividend of $1.00 per share and has a dividend yield of 1.1%. California BanCorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.1%. Red River Bancshares pays out 15.0% of its earnings in the form of a dividend. California BanCorp pays out 21.9% 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. Red River Bancshares has increased its dividend for 3 consecutive years.
Insider and Institutional Ownership
27.5% of Red River Bancshares shares are owned by institutional investors. Comparatively, 55.4% of California BanCorp shares are owned by institutional investors. 16.6% of Red River Bancshares shares are owned by insiders. Comparatively, 8.1% of California BanCorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares Red River Bancshares and California BanCorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Red River Bancshares | 25.74% | 12.46% | 1.36% |
| California BanCorp | 25.68% | 10.59% | 1.49% |
Summary
California BanCorp beats Red River Bancshares on 10 of the 18 factors compared between the two stocks.
About Red River Bancshares
Red River Bancshares, Inc. operates as a bank holding company for Red River Bank that provides banking products and services to commercial and retail customers in Louisiana. The company provides various deposit products, including checking, saving, money market accounts, and time deposits. It offers commercial real estate loans; one-to-four family mortgage loans and home equity lines of credit; construction and development loans; commercial and industrial loans; small business administration paycheck protection program loans; tax-exempt loans; consumer loans to individuals for personal, family, and household purposes, including secured and unsecured installment and term loans; home mortgage loans; and lines of credit and standby letters of credit. In addition, the company provides treasury management, private banking, and brokerage; investment advisory, financial planning, and a suite of retirement plans; debit and credit cards, direct deposits, cashier's checks, and wire transfer services; online banking services, including access to account balances, online transfers, online bill payment, and electronic delivery of customer statements; and banking services in person, through ATMs, drive-through facilities, night deposits, telephone, mail, mobile banking, and remote deposits. Red River Bancshares, Inc. was incorporated in 1998 and is headquartered in Alexandria, Louisiana.
About California BanCorp
Southern California Bancorp operates as the holding company for Bank of Southern California, N.A. that provides various financial products to individuals, professionals, and small-to medium-sized businesses. The company offers checking, personal and business savings, and money market accounts, as well as certificates of deposit. It also provides home equity lines of credit, business loans and lines of credit, commercial real estate and construction loans, small business administration loans, letters of credit, and personal and business credit cards. In addition, the company provides cash vault, sweep accounts, and remote deposit capture services; online and mobile banking services; courier service; lockbox services; and merchant services. It operates branches in San Diego, Orange, Ventura, Los Angeles, and Riverside counties, as well as the Inland Empire. The company was founded in 2001 and is headquartered in San Diego, California.
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