Bank of Marin Bancorp (NASDAQ: BMRC) and Heritage Oaks Bancorp (NASDAQ:HEOP) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.
Bank of Marin Bancorp pays an annual dividend of $1.16 per share and has a dividend yield of 1.7%. Heritage Oaks Bancorp pays an annual dividend of $0.24 per share. Bank of Marin Bancorp pays out 45.0% of its earnings in the form of a dividend. Heritage Oaks Bancorp pays out 48.0% 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. Bank of Marin Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.
41.7% of Bank of Marin Bancorp shares are held by institutional investors. Comparatively, 63.1% of Heritage Oaks Bancorp shares are held by institutional investors. 5.2% of Bank of Marin Bancorp shares are held by insiders. Comparatively, 31.3% of Heritage Oaks Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
This table compares Bank of Marin Bancorp and Heritage Oaks Bancorp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Bank of Marin Bancorp||18.83%||8.57%||0.98%|
|Heritage Oaks Bancorp||22.37%||8.53%||0.91%|
This is a summary of recent recommendations for Bank of Marin Bancorp and Heritage Oaks Bancorp, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Bank of Marin Bancorp||0||3||0||0||2.00|
|Heritage Oaks Bancorp||0||0||0||0||N/A|
Bank of Marin Bancorp currently has a consensus price target of $73.67, suggesting a potential upside of 6.61%.
Earnings and Valuation
This table compares Bank of Marin Bancorp and Heritage Oaks Bancorp’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Bank of Marin Bancorp||$84.86 million||5.63||$15.98 million||$2.58||26.78|
|Heritage Oaks Bancorp||N/A||N/A||N/A||$0.50||N/A|
Bank of Marin Bancorp has higher revenue and earnings than Heritage Oaks Bancorp. Heritage Oaks Bancorp is trading at a lower price-to-earnings ratio than Bank of Marin Bancorp, indicating that it is currently the more affordable of the two stocks.
Bank of Marin Bancorp beats Heritage Oaks Bancorp on 7 of the 10 factors compared between the two stocks.
About Bank of Marin Bancorp
Bank of Marin Bancorp (Bancorp) is the holding company for Bank of Marin (the Bank). The Company’s business banking focus is on small to medium-sized businesses, professionals and not-for-profit organizations. The Company operates through 23 offices in Marin, Sonoma, San Francisco, Napa and Alameda counties. It makes international banking services available to its customers indirectly through other financial institutions, with whom it has correspondent banking relationships. The Company offers a range of commercial and retail deposit and lending programs. Its lending categories include commercial real estate loans, commercial and industrial loans, construction financing, consumer loans and home equity lines of credit. The Company offers a range of personal and business checking and savings accounts, and time deposit alternatives.
About Heritage Oaks Bancorp
Heritage Oaks Bancorp is a bank holding company for Heritage Oaks Bank (the Bank). The Bank is a community-oriented financial services company that provides banking products and services to small and medium sized businesses and consumers. As of December 31, 2016, its products and services were offered primarily through 12 retail branches located on the Central Coast of California, in San Luis Obispo and Santa Barbara Counties and through other direct channels, including a loan production office in Ventura County. The Bank offers to its commercial clients commercial loans secured by real estate, other commercial loans and lines of credit, agricultural loans, construction financing, other real estate loans and small business administration loans. Its deposit products offered include personal and business checking and savings accounts, time deposit accounts, individual retirement accounts (IRAs), health savings accounts (HSAs), and money market accounts.
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