Carolina Financial Corporation (NASDAQ: CARO) and Banc of California (NASDAQ:FPTB) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, profitability, dividends, analyst recommendations, earnings, institutional ownership and valuation.

Dividends

Carolina Financial Corporation pays an annual dividend of $0.16 per share and has a dividend yield of 0.4%. Banc of California does not pay a dividend. Carolina Financial Corporation pays out 8.7% of its earnings in the form of a dividend.

Profitability

This table compares Carolina Financial Corporation and Banc of California’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Carolina Financial Corporation 24.80% 12.07% 1.43%
Banc of California 18.64% 5.41% 0.57%

Valuation & Earnings

This table compares Carolina Financial Corporation and Banc of California’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Carolina Financial Corporation $96.62 million 6.01 $29.38 million $1.83 19.77
Banc of California N/A N/A N/A N/A N/A

Carolina Financial Corporation has higher revenue and earnings than Banc of California.

Analyst Ratings

This is a summary of current ratings and target prices for Carolina Financial Corporation and Banc of California, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Carolina Financial Corporation 0 1 3 1 3.00
Banc of California 0 0 0 0 N/A

Carolina Financial Corporation presently has a consensus price target of $36.75, indicating a potential upside of 1.60%. Given Carolina Financial Corporation’s higher probable upside, equities research analysts plainly believe Carolina Financial Corporation is more favorable than Banc of California.

Insider and Institutional Ownership

43.4% of Carolina Financial Corporation shares are owned by institutional investors. 12.2% of Carolina Financial Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Carolina Financial Corporation beats Banc of California on 10 of the 11 factors compared between the two stocks.

Carolina Financial Corporation Company Profile

Carolina Financial Corporation is a bank holding company. The Company operates through CresCom Bank (the Bank), a state-chartered commercial bank. The Company operates through three segments: community banking, wholesale mortgage banking (mortgage banking) and other. The Company’s community banking segment provides traditional banking services offered through CresCom Bank. The Company’s mortgage banking segment provides mortgage loan origination and servicing offered through Crescent Mortgage Company (Crescent Mortgage). The other segment provides managerial and operational support to the other business segments through Carolina Services and Carolina Financial. CresCom Bank provides a range of commercial and retail banking financial services to meet the financial needs of its customers through its branch network in South Carolina and North Carolina.

Banc of California Company Profile

Banc of California, Inc. is a financial holding company. The Company is the parent of Banc of California, National Association (the Bank). The Company operates through Commercial Banking; Mortgage Banking, and Corporate/Other segments. As of December 31, 2016, the Bank had 90 California banking locations, including 39 full service branches in San Diego, Orange, Santa Barbara, and Los Angeles Counties. The Bank offers automated bill payment, cash and treasury management, master demand accounts, foreign exchange, interest rate swaps, trust services, card payment services, remote and mobile deposit capture, automatic clearing house (ACH) origination, wire transfer, direct deposit, and safe deposit boxes. Bank customers also have the ability to access their accounts through a nationwide network of automated teller machines (ATMs), online, telephone and mobile banking. The Bank’s lending activities are focused on providing financing to private businesses, entrepreneurs and homeowners.

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