RBB Bancorp (NASDAQ:RBB) versus FS Bancorp (NASDAQ:FSBW) Head to Head Comparison

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
RBB Bancorp	16.76%	7.85%	0.98%
FS Bancorp	14.91%	10.88%	1.04%

Analyst Recommendations

This is a summary of recent ratings and price targets for RBB Bancorp and FS Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RBB Bancorp	0	3	1	1	2.60
FS Bancorp	0	1	1	0	2.50

RBB Bancorp currently has a consensus price target of $23.33, indicating a potential downside of 2.45%. FS Bancorp has a consensus price target of $46.00, indicating a potential upside of 12.99%. Given FS Bancorp’s higher possible upside, analysts clearly believe FS Bancorp is more favorable than RBB Bancorp.

Insider & Institutional Ownership

40.1% of RBB Bancorp shares are owned by institutional investors. Comparatively, 63.9% of FS Bancorp shares are owned by institutional investors. 6.8% of RBB Bancorp shares are owned by company insiders. Comparatively, 12.9% of FS Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares RBB Bancorp and FS 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	1.70	$31.95 million	$2.36	10.14
FS Bancorp	$219.52 million	1.00	$33.35 million	$4.29	9.49

FS Bancorp has lower revenue, but higher earnings than RBB Bancorp. FS 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.

Dividends

RBB Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 2.7%. FS Bancorp pays an annual dividend of $1.16 per share and has a dividend yield of 2.8%. RBB Bancorp pays out 27.1% of its earnings in the form of a dividend. FS Bancorp pays out 27.0% 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. FS Bancorp has raised its dividend for 12 consecutive years. FS Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

RBB Bancorp has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500. Comparatively, FS Bancorp has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500.

Summary

FS Bancorp beats RBB Bancorp on 10 of the 17 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 FS Bancorp

FS Bancorp, Inc. operates as a bank holding company for 1st Security Bank of Washington that provides banking and financial services to local families, local and regional businesses, and industry niches. The company operates in two segments, Commercial and Consumer Banking; and Home Lending. It offers various deposit instruments, including checking accounts, money market deposit accounts, savings accounts, and certificates of deposit. The company provides one-to-four-family residential first mortgages, second mortgage/home equity loan products, non-mortgage commercial business loans, commercial real estate loans, and construction and development loans, as well as consumer loans, which primarily include personal lines of credit, credit cards, automobile, direct home improvement, loans on deposit, and recreational loans. It operates full bank service branches and home loan production offices in suburban communities in the greater Puget Sound area, including Snohomish, King, Pierce, Jefferson, Kitsap, Clallam, Grays Harbor, and Thurston counties; and a loan production office in the market area of the Tri-Cities. FS Bancorp, Inc. was founded in 1936 and is headquartered in Mountlake Terrace, Washington.