Head-To-Head Survey: Community West Bancshares (NASDAQ:CWBC) & Rithm Capital (NYSE:RITM)

Rithm Capital (NYSE:RITM) and Community West Bancshares (NASDAQ:CWBC) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Earnings and Valuation

This table compares Rithm Capital and Community West Bancshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rithm Capital	$4.59 billion	1.13	$681.45 million	$1.09	8.56
Community West Bancshares	$196.20 million	3.34	$38.17 million	$2.16	11.17

Rithm Capital has higher revenue and earnings than Community West Bancshares. Rithm Capital is trading at a lower price-to-earnings ratio than Community West Bancshares, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Rithm Capital has a beta of 1.17, indicating that its share price is 17% more volatile than the S&P 500. Comparatively, Community West Bancshares has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500.

Profitability

This table compares Rithm Capital and Community West Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rithm Capital	14.44%	19.48%	2.87%
Community West Bancshares	20.77%	10.44%	1.15%

Analyst Ratings

This is a breakdown of current ratings and target prices for Rithm Capital and Community West Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rithm Capital	1	0	9	0	2.80
Community West Bancshares	0	2	3	0	2.60

Rithm Capital currently has a consensus target price of $13.61, indicating a potential upside of 45.96%. Community West Bancshares has a consensus target price of $28.17, indicating a potential upside of 16.78%. Given Rithm Capital’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Rithm Capital is more favorable than Community West Bancshares.

Dividends

Rithm Capital pays an annual dividend of $1.00 per share and has a dividend yield of 10.7%. Community West Bancshares pays an annual dividend of $0.48 per share and has a dividend yield of 2.0%. Rithm Capital pays out 91.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Community West Bancshares pays out 22.2% of its earnings in the form of a dividend.

Institutional and Insider Ownership

44.9% of Rithm Capital shares are held by institutional investors. Comparatively, 33.8% of Community West Bancshares shares are held by institutional investors. 0.6% of Rithm Capital shares are held by insiders. Comparatively, 9.0% of Community West Bancshares shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Rithm Capital beats Community West Bancshares on 10 of the 16 factors compared between the two stocks.

About Rithm Capital

Rithm Capital Corp. operates as an asset manager focused on real estate, credit, and financial services. It operates through Origination and Servicing, Investment Portfolio, Mortgage Loans Receivable, and Asset Management segments. Its investment portfolio primarily comprises of mortgage servicing rights (MSR), and MSR financing receivables, title, appraisal and property preservation, excess MSRs, and services advance investments; real estate securities, call rights, SFR properties, and residential mortgage loans; consumer and business purpose loans; and asset management related investments. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as New Residential Investment Corp. and changed its name to Rithm Capital Corp. in August 2022. Rithm Capital Corp. was incorporated in 2011 and is based in New York, New York.

About Community West Bancshares

Community West Bancshares operates as the bank holding company for Community West Bank, N.A. that provides various financial products and services in California. The company offers deposit products, such as checking accounts, savings accounts, money market accounts, and fixed rate and fixed maturity certificates of deposits; and cash management products. It also provides commercial, commercial real estate, consumer, manufactured housing, and small business administration loans, as well as agricultural loans for real estate and operating lines; home equity lines of credit collateralized by residential real estate; single family real estate loans; and installment loans consisting of automobile and general-purpose loans. The company serves small to medium-sized businesses and their owners, professionals, high-net worth individuals, and non-profit organizations. Community West Bancshares was founded in 1989 and is headquartered in Goleta, California.