Comparing BanColombia (CIB) and PacWest Bancorp (NASDAQ:PACW)

BanColombia (NYSE: CIB) and PacWest Bancorp (NASDAQ:PACW) are both mid-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, dividends, risk, valuation, profitability and analyst recommendations.

Valuation and Earnings

This table compares BanColombia and PacWest Bancorp’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
BanColombia $3.63 billion 2.88 $1.11 billion $4.62 9.41
PacWest Bancorp $1.01 billion 5.38 $347.90 million $2.90 15.62

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

Profitability

This table compares BanColombia and PacWest Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BanColombia 15.48% 14.15% 1.59%
PacWest Bancorp 30.61% 7.73% 1.60%

Analyst Ratings

This is a breakdown of current ratings and target prices for BanColombia and PacWest Bancorp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BanColombia 1 3 3 0 2.29
PacWest Bancorp 0 3 6 2 2.91

BanColombia currently has a consensus price target of $44.33, suggesting a potential upside of 1.96%. PacWest Bancorp has a consensus price target of $55.44, suggesting a potential upside of 22.42%. Given PacWest Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe PacWest Bancorp is more favorable than BanColombia.

Volatility & Risk

BanColombia has a beta of 0.32, indicating that its share price is 68% less volatile than the S&P 500. Comparatively, PacWest Bancorp has a beta of 1.58, indicating that its share price is 58% more volatile than the S&P 500.

Insider & Institutional Ownership

16.1% of BanColombia shares are owned by institutional investors. Comparatively, 86.5% of PacWest Bancorp shares are owned by institutional investors. 1.0% of PacWest Bancorp shares are owned by company 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.

Dividends

BanColombia pays an annual dividend of $1.23 per share and has a dividend yield of 2.8%. PacWest Bancorp pays an annual dividend of $2.00 per share and has a dividend yield of 4.4%. BanColombia pays out 26.6% of its earnings in the form of a dividend. PacWest Bancorp pays out 69.0% 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.

Summary

PacWest Bancorp beats BanColombia on 12 of the 17 factors compared between the two stocks.

BanColombia Company Profile

Bancolombia S.A. (Bancolombia) is a financial institution engaged in providing a range of financial products and services to a diversified individual, corporate, and government customer base throughout Colombia, Latin America and the Caribbean region. The Bank operates through 10 segments: Banking Colombia, Banking Panama, Banking El Salvador, Leasing, Trust, Investment Banking, Brokerage, Off Shore and All other. It delivers its products and services through its regional network comprising Colombia’s non-Government owned banking network, El Salvador’s financial conglomerate by gross loans, Guatemala’s bank, Panama’s bank and off-shore banking subsidiaries in Panama, Cayman and Puerto Rico, as well as subsidiaries in Peru. The Bank and its subsidiaries offer Savings And Investment, Ahorro A La Mano, Financing, Mortgage Banking, Factoring, Financial and Operating Leases, Capital Markets, eTrading, Cash Management, Foreign Currency, Bancassurance, Investment Banking and Trust Services.

PacWest Bancorp Company Profile

PacWest Bancorp is a bank holding company for Pacific Western Bank (the Bank). The Company is focused on relationship-based business banking to small, middle-market and venture-backed businesses. As of December 31, 2016, the Bank offered a range of loan and deposit products and services through 77 branches located throughout the state of California, one branch located in Durham, North Carolina, and several loan production offices located in cities across the country. The Company provides commercial banking services, and deposit and treasury management services to small and middle-market businesses. It offers products and services through its CapitalSource and Square 1 Bank divisions. In addition, the Company provides investment advisory and asset management services to select clients through Square 1 Asset Management, Inc., a subsidiary of the Bank.

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