PacWest Bancorp (NASDAQ:PACW) vs. BanColombia (CIB) Critical Survey
PacWest Bancorp (NASDAQ: PACW) and BanColombia (NYSE:CIB) are both mid-cap financials companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, valuation, risk and profitabiliy.
Insider and Institutional Ownership
86.6% of PacWest Bancorp shares are held by institutional investors. Comparatively, 16.3% of BanColombia shares are held by institutional investors. 1.0% of PacWest Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares PacWest Bancorp and BanColombia’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|PacWest Bancorp||$1.01 billion||5.73||$347.90 million||$2.90||16.64|
|BanColombia||$3.59 billion||2.95||$1.11 billion||$4.62||9.52|
BanColombia has higher revenue and earnings than PacWest Bancorp. BanColombia is trading at a lower price-to-earnings ratio than PacWest Bancorp, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
PacWest Bancorp has a beta of 1.58, suggesting that its share price is 58% more volatile than the S&P 500. Comparatively, BanColombia has a beta of 0.32, suggesting that its share price is 68% less volatile than the S&P 500.
PacWest Bancorp pays an annual dividend of $2.00 per share and has a dividend yield of 4.1%. BanColombia pays an annual dividend of $1.23 per share and has a dividend yield of 2.8%. PacWest Bancorp pays out 69.0% of its earnings in the form of a dividend. BanColombia pays out 26.6% 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.
This is a breakdown of recent ratings and target prices for PacWest Bancorp and BanColombia, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
PacWest Bancorp currently has a consensus price target of $55.44, indicating a potential upside of 14.89%. BanColombia has a consensus price target of $44.33, indicating a potential upside of 0.80%. Given PacWest Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe PacWest Bancorp is more favorable than BanColombia.
This table compares PacWest Bancorp and BanColombia’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
PacWest Bancorp beats BanColombia on 12 of the 17 factors compared between the two stocks.
PacWest Bancorp Company Profile
PacWest Bancorp is a bank holding company for Pacific Western Bank (the Bank). The Company is focused on relationship-based business banking to small, middle-market and venture-backed businesses. As of December 31, 2016, the Bank offered a range of loan and deposit products and services through 77 branches located throughout the state of California, one branch located in Durham, North Carolina, and several loan production offices located in cities across the country. The Company provides commercial banking services, and deposit and treasury management services to small and middle-market businesses. It offers products and services through its CapitalSource and Square 1 Bank divisions. In addition, the Company provides investment advisory and asset management services to select clients through Square 1 Asset Management, Inc., a subsidiary of the Bank.
BanColombia Company Profile
Bancolombia S.A. (Bancolombia) is a financial institution engaged in providing a range of financial products and services to a diversified individual, corporate, and government customer base throughout Colombia, Latin America and the Caribbean region. The Bank operates through 10 segments: Banking Colombia, Banking Panama, Banking El Salvador, Leasing, Trust, Investment Banking, Brokerage, Off Shore and All other. It delivers its products and services through its regional network comprising Colombia’s non-Government owned banking network, El Salvador’s financial conglomerate by gross loans, Guatemala’s bank, Panama’s bank and off-shore banking subsidiaries in Panama, Cayman and Puerto Rico, as well as subsidiaries in Peru. The Bank and its subsidiaries offer Savings And Investment, Ahorro A La Mano, Financing, Mortgage Banking, Factoring, Financial and Operating Leases, Capital Markets, eTrading, Cash Management, Foreign Currency, Bancassurance, Investment Banking and Trust Services.
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