Community West Bancshares (NASDAQ:CWBC) and FB Financial (NYSE:FBK) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, risk, dividends and analyst recommendations.
This table compares Community West Bancshares and FB Financial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Community West Bancshares||16.14%||10.21%||0.89%|
This is a summary of current recommendations for Community West Bancshares and FB Financial, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Community West Bancshares||0||0||0||0||N/A|
FB Financial has a consensus price target of $42.13, indicating a potential upside of 14.78%. Given FB Financial’s higher probable upside, analysts clearly believe FB Financial is more favorable than Community West Bancshares.
Community West Bancshares pays an annual dividend of $0.22 per share and has a dividend yield of 2.0%. FB Financial pays an annual dividend of $0.32 per share and has a dividend yield of 0.9%. FB Financial pays out 11.3% of its earnings in the form of a dividend. Community West Bancshares has raised its dividend for 4 consecutive years and FB Financial has raised its dividend for 1 consecutive years. Community West Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Volatility and Risk
Community West Bancshares has a beta of 0.43, suggesting that its share price is 57% less volatile than the S&P 500. Comparatively, FB Financial has a beta of 0.99, suggesting that its share price is 1% less volatile than the S&P 500.
Institutional and Insider Ownership
23.9% of Community West Bancshares shares are held by institutional investors. Comparatively, 53.8% of FB Financial shares are held by institutional investors. 21.8% of Community West Bancshares shares are held by company insiders. Comparatively, 45.1% of FB Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares Community West Bancshares and FB Financial’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Community West Bancshares||$49.35 million||1.93||$7.96 million||N/A||N/A|
|FB Financial||$370.16 million||3.08||$83.80 million||$2.83||12.97|
FB Financial has higher revenue and earnings than Community West Bancshares.
FB Financial beats Community West Bancshares on 12 of the 15 factors compared between the two stocks.
Community West Bancshares Company Profile
Community West Bancshares operates as the bank holding company for Community West Bank, N.A. that provides various financial products and services in California. The company offers deposit products, such as checking accounts, savings accounts, money market accounts, and fixed rate and fixed maturity certificates of deposit, as well as cash management products. It also provides commercial, commercial real estate, consumer, manufactured housing, and small business administration loans, as well as agricultural loans for real estate and operating lines; home equity lines of credit, as well as lines of credit collateralized by residential real estate; single family real estate loans; and installment loans consisting of automobile and general-purpose loans. The company serves small to medium-sized businesses and professional organizations. It operates a network of eight branch banking offices in Goleta, Oxnard, San Luis Obispo, Santa Barbara, Santa Maria, Ventura, Paso Robles, and Westlake Village. Community West Bancshares was founded in 1989 and is headquartered in Goleta, California.
FB Financial Company Profile
FB Financial Corporation operates as a bank holding company for FirstBank that provides a suite of commercial and consumer banking services businesses, professionals, and individuals. The company operates in two segments, Banking and Mortgage. It provides demand, negotiable order of withdrawal, money market, certificates of deposit, and municipal and savings accounts, as well as time deposits. The company also offers commercial lending products that include working capital lines of credit, equipment loans, owner-occupied and non-owner-occupied real estate construction loans, real estate term loans, and cash flow loans to small and medium sized businesses; and consumer lending products comprising first and second residential mortgage loans, and home equity lines of credit, as well as consumer installment loans to purchase cars, boats, and other recreational vehicles. In addition, it provides residential mortgage products and services through its bank branches and mortgage offices located in the southeastern United States; and an Internet delivery channel, as well as third-party mortgage services to smaller community banks and mortgage companies. Further, the company offers investment services, including equities, mutual funds, bonds, tax-exempt municipals, and annuities; and money management consultation and insurance agency, as well as retirement plan advisory services. Additionally, it provides online and mobile banking, direct deposit, wire transfer, night depository, banking-by-mail, remote capture, and cash management services. It operates 58 full-service bank branches and 9 other banking locations throughout Tennessee, North Alabama, and North Georgia; and 19 mortgage offices throughout the southeastern United States. The company was formerly known as First South Bancorp, Inc. and changed its name to FB Financial Corporation in March 2016. FB Financial Corporation was founded in 1906 and is headquartered in Nashville, Tennessee.
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