Banc of California (NYSE:BANC) and United Security Bancshares (NASDAQ:UBFO) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their institutional ownership, earnings, profitability, analyst recommendations, dividends, valuation and risk.

Profitability

This table compares Banc of California and United Security Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Banc of California 10.28% 7.94% 0.57%
United Security Bancshares 33.94% 14.13% 1.64%

Analyst Recommendations

This is a summary of recent ratings for Banc of California and United Security Bancshares, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Banc of California 4 2.00
United Security Bancshares N/A

Banc of California presently has a consensus target price of $17.00, indicating a potential upside of 18.55%. Given Banc of California’s higher possible upside, equities analysts plainly believe Banc of California is more favorable than United Security Bancshares.

Valuation & Earnings

This table compares Banc of California and United Security Bancshares’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Banc of California $446.71 million 1.63 $45.47 million $0.49 29.27
United Security Bancshares $41.22 million 4.40 $14.02 million N/A N/A

Banc of California has higher revenue and earnings than United Security Bancshares.

Institutional and Insider Ownership

98.8% of Banc of California shares are owned by institutional investors. Comparatively, 23.6% of United Security Bancshares shares are owned by institutional investors. 11.1% of Banc of California shares are owned by company insiders. Comparatively, 21.5% of United Security Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Banc of California pays an annual dividend of $0.24 per share and has a dividend yield of 1.7%. United Security Bancshares pays an annual dividend of $0.44 per share and has a dividend yield of 4.1%. Banc of California pays out 49.0% of its earnings in the form of a dividend.

Volatility and Risk

Banc of California has a beta of 1.34, meaning that its share price is 34% more volatile than the S&P 500. Comparatively, United Security Bancshares has a beta of 0.45, meaning that its share price is 55% less volatile than the S&P 500.

Summary

United Security Bancshares beats Banc of California on 7 of the 13 factors compared between the two stocks.

Banc of California Company Profile

Banc of California, Inc. operates as the bank holding company for Banc of California, National Association that provides banking products and services in the United States. The company offers deposit products, including checking, savings, money market, retirement, and interest and noninterest-bearing demand accounts, as well as certificates of deposits. It also provides various commercial and consumer loan products, such as commercial and industrial loans; commercial real estate loans; multifamily loans; construction and renovation loans; single family residential mortgage loans; warehouse loans; asset, insurance, or security-backed loans; home equity lines of credit; consumer and business lines of credit; small business administration loans; and other consumer loans. In addition, the company offers automated bill payment, cash and treasury management, foreign exchange, card payment, remote and mobile deposit capture, automated clearing house origination, wire transfer, direct deposit, and Internet banking services; and master demand accounts, interest rate swaps, and safe deposit boxes. As of December 31, 2018, it operated 32 full service branches in San Diego, Orange, Santa Barbara, and Los Angeles counties in California. The company was formerly known as First PacTrust Bancorp, Inc. and changed its name to Banc of California, Inc. in July 2013. Banc of California, Inc. was founded in 1941 and is headquartered in Santa Ana, California.

United Security Bancshares Company Profile

United Security Bancshares operates as the holding company for United Security Bank, a state-chartered bank that provides a range of commercial banking services to the business and professional community, and individuals in California. The company accepts various deposit products, including personal and business checking accounts, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificates of deposit. Its loan portfolio comprises real estate mortgage, commercial and industrial, real estate construction, and consumer loans, as well as agricultural and installment loans. The company also offers cashier’s check, traveler’s check, money order, foreign draft, online and mobile banking, safe deposit box, payroll direct deposit, and interactive teller and ATM services. As of January 23, 2019, it operated through 11 full-service branch offices in Fresno, Bakersfield, Campbell, Caruthers, Coalinga, Firebaugh, Oakhurst, San Joaquin, and Taft, California. The company was founded in 1987 and is headquartered in Fresno, California.

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