Head-To-Head Comparison: Lakeland Financial (LKFN) & RBB Bancorp (RBB)

Lakeland Financial (NASDAQ: LKFN) and RBB Bancorp (NASDAQ:RBB) are both small-cap banks – nec companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, profitability, risk, institutional ownership, analyst recommendations and dividends.

Analyst Ratings

This is a summary of current ratings for Lakeland Financial and RBB Bancorp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lakeland Financial 0 1 1 0 2.50
RBB Bancorp 0 0 3 0 3.00

Lakeland Financial currently has a consensus price target of $49.50, indicating a potential downside of 2.86%. RBB Bancorp has a consensus price target of $27.50, indicating a potential upside of 2.31%. Given RBB Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe RBB Bancorp is more favorable than Lakeland Financial.

Earnings and Valuation

This table compares Lakeland Financial and RBB Bancorp’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Lakeland Financial $171.82 million 7.47 $52.08 million $2.31 22.06
RBB Bancorp $77.15 million 5.50 $19.07 million $1.64 16.39

Lakeland Financial has higher revenue and earnings than RBB Bancorp. RBB Bancorp is trading at a lower price-to-earnings ratio than Lakeland Financial, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

69.9% of Lakeland Financial shares are held by institutional investors. Comparatively, 23.8% of RBB Bancorp shares are held by institutional investors. 5.0% of Lakeland Financial shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Lakeland Financial pays an annual dividend of $0.88 per share and has a dividend yield of 1.7%. RBB Bancorp pays an annual dividend of $0.08 per share and has a dividend yield of 0.3%. Lakeland Financial pays out 38.1% of its earnings in the form of a dividend. RBB Bancorp pays out 4.9% 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.

Profitability

This table compares Lakeland Financial and RBB Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lakeland Financial 30.67% 13.33% 1.36%
RBB Bancorp N/A N/A N/A

Summary

Lakeland Financial beats RBB Bancorp on 11 of the 15 factors compared between the two stocks.

About Lakeland Financial

Lakeland Financial Corporation is a bank holding company. The Company, through its subsidiary, Lake City Bank (the Bank), provides an array of products and services throughout its Northern and Central Indiana markets. It offers commercial and consumer banking services, as well as trust and wealth management, brokerage, investment and treasury management commercial services. It serves a range of industries, including commercial real estate, manufacturing, agriculture, construction, retail, wholesale, finance and insurance, accommodation and food services, and healthcare. The Bank’s activities cover all phases of commercial banking, including deposit products, commercial and consumer lending, retail and merchant credit card services, corporate treasury management services, and wealth advisory, trust and brokerage services. It provides financial services through the Bank, with approximately 50 branch offices in 15 counties in Northern and Central Indiana.

About RBB Bancorp

RBB Bancorp (the Bank) is a bank holding company with the principal business to serve as the holding company for its wholly-owned banking subsidiaries, including Royal Business Bank (Bank) and RBB Asset Management Company (RAM). The Company operates Royal Business Bank, which is a California state-chartered commercial bank. The Bank is focused on providing commercial banking services. The Bank’s offerings include traditional commercial real estate loans, secured commercial and industrial loans, and trade finance services for companies doing business in China, Taiwan and other Asian countries. The non-qualified single-family residential mortgage loans, small business administration loans. As of March 31, 2017, the Company had total consolidated assets of $1.5 billion, total consolidated deposits of $1.2 billion and total consolidated shareholders equity of $183.5 million.

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