Analyzing Sierra Bancorp (NASDAQ:BSRR) & RBB Bancorp (NASDAQ:RBB)

RBB Bancorp (NASDAQ:RBB) and Sierra Bancorp (NASDAQ:BSRR) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, dividends, analyst recommendations, profitability, risk, institutional ownership and valuation.

Insider & Institutional Ownership

40.1% of RBB Bancorp shares are owned by institutional investors. Comparatively, 55.4% of Sierra Bancorp shares are owned by institutional investors. 4.6% of RBB Bancorp shares are owned by insiders. Comparatively, 11.6% of Sierra Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
RBB Bancorp	13.42%	6.21%	0.78%
Sierra Bancorp	20.96%	11.90%	1.15%

Dividends

RBB Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 3.0%. Sierra Bancorp pays an annual dividend of $1.04 per share and has a dividend yield of 2.9%. RBB Bancorp pays out 35.0% of its earnings in the form of a dividend. Sierra Bancorp pays out 33.3% 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. Sierra Bancorp has raised its dividend for 2 consecutive years.

Valuation & Earnings

This table compares RBB Bancorp and Sierra Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RBB Bancorp	$238.00 million	1.54	$31.95 million	$1.83	11.75
Sierra Bancorp	$201.98 million	2.37	$42.33 million	$3.12	11.53

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

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for RBB Bancorp and Sierra Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RBB Bancorp	0	4	0	0	2.00
Sierra Bancorp	0	1	2	1	3.00

RBB Bancorp currently has a consensus target price of $22.00, indicating a potential upside of 2.33%. Sierra Bancorp has a consensus target price of $38.50, indicating a potential upside of 7.00%. Given Sierra Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe Sierra Bancorp is more favorable than RBB Bancorp.

Risk and Volatility

RBB Bancorp has a beta of 1.08, meaning that its stock price is 8% more volatile than the S&P 500. Comparatively, Sierra Bancorp has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500.

Summary

Sierra Bancorp beats RBB Bancorp on 14 of the 18 factors compared between the two stocks.

About RBB Bancorp

RBB Bancorp operates as the bank holding company for Royal Business Bank that provides various banking products and services to the Chinese-American, Korean-American, and other Asian-American communities. Its deposit products include checking, savings, and money market accounts, as well as certificates of deposit. The company also offers commercial and industrial lines of credit, term loans, mortgage warehouse lines, and international trade discounts; commercial real estate loans; residential, commercial, and land acquisition and development construction loans; small business administration loans; and single-family residential mortgage loans. In addition, it provides international letters of credit, SWIFT, export advisory, trade finance discount, and foreign exchange services; and remote deposit, e-banking, and mobile banking services. The company serves individuals, businesses, municipalities, and other entities. It operates branches in the Western region with branches in Los Angeles County, California; Orange County, California; Ventura County, California; Clark County, Nevada; Honolulu, Hawaii, as well as in Eastern region with branches in Manhattan, Brooklyn and Queens, New York; Chicago, Illinois; and Edison, New Jersey. RBB Bancorp was founded in 2008 and is headquartered in Los Angeles, California.

About Sierra Bancorp

Sierra Bancorp operates as the bank holding company for Bank of the Sierra that provides retail and commercial banking services to individuals and businesses in California. It accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. The company's loan products include agricultural, commercial, consumer, real estate, construction, and mortgage loans. It also offers automated teller machines; electronic point-of-sale payment alternatives; online and automated telephone banking services; and remote deposit capture and automated payroll services for business customers. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.