Head-To-Head Contrast: Texas Capital Bancshares (NASDAQ:TCBI) and Banc of California (NYSE:BANC)

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

Analyst Ratings

This is a summary of recent ratings for Texas Capital Bancshares and Banc of California, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Texas Capital Bancshares	3	7	4	0	2.07
Banc of California	0	4	8	0	2.67

Texas Capital Bancshares currently has a consensus target price of $78.00, suggesting a potential upside of 1.19%. Banc of California has a consensus target price of $17.17, suggesting a potential upside of 23.86%. Given Banc of California’s stronger consensus rating and higher possible upside, analysts plainly believe Banc of California is more favorable than Texas Capital Bancshares.

Profitability

This table compares Texas Capital Bancshares and Banc of California’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Texas Capital Bancshares	5.04%	9.39%	0.92%
Banc of California	8.23%	6.30%	0.55%

Insider and Institutional Ownership

96.9% of Texas Capital Bancshares shares are owned by institutional investors. Comparatively, 86.9% of Banc of California shares are owned by institutional investors. 1.7% of Texas Capital Bancshares shares are owned by company insiders. Comparatively, 2.7% of Banc of California shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Texas Capital Bancshares has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500. Comparatively, Banc of California has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.

Valuation & Earnings

This table compares Texas Capital Bancshares and Banc of California”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Texas Capital Bancshares	$1.94 billion	1.82	$77.51 million	$1.74	44.30
Banc of California	$1.89 billion	1.08	$126.89 million	$0.65	21.32

Banc of California has lower revenue, but higher earnings than Texas Capital Bancshares. Banc of California is trading at a lower price-to-earnings ratio than Texas Capital Bancshares, indicating that it is currently the more affordable of the two stocks.

About Texas Capital Bancshares

Texas Capital Bancshares, Inc. operates as the bank holding company for Texas Capital Bank, is a full-service financial services firm that delivers customized solutions to businesses, entrepreneurs, and individual customers. The company offers commercial banking; consumer banking; investment banking solutions, including capital markets, mergers and acquisitions, and syndicated finance, as well as financial sponsor coverage, capital solutions, and institutional services; and wealth management services, such as investment management, financial planning, lockbox and insurance, securities-based lending, estate planning, and business succession, as well as philanthropic, trustee and executor, custom credit, and depository services. It also provides deposit accounts, analyzed accounts, commercial card, SBA and business loans, packaged solutions, and merchant services; liquidity and investments, working capital, international trade and payment, and treasury and credit products; and commercial real estate, homebuilder and community, and mortgage finance. In addition, the company offers payables and receivables management; online and mobile banking; term loans and lines of credit, equipment finance and lease, acquisition finance, and asset-based lending; private wealth advisory solutions; and checking and savings accounts, debit and credit cards, and certificates of deposit, as well as ETF and funds management services. Further, it provides financial institution money market accounts and loan syndication products; commercial loans for financing for working capital, organic growth, and acquisitions; real estate term and construction loans; mortgage warehouse lending services; treasury management, trust, and advisory and escrow services; and letters of credit. The company operates in Austin, Dallas, Fort Worth, Houston, and San Antonio metropolitan areas of Texas. Texas Capital Bancshares, Inc. was incorporated in 1996 and is headquartered in Dallas, Texas.

About Banc of California

Banc of California, Inc. operates as the bank holding company for Banc of California that provides various banking products and services in California. The company offers deposit products, such as checking, savings, money market, demand, and time deposits; certificates of deposit; retirement accounts; and safe deposit boxes. It also provides real estate loans to professional developers and real estate investors for the acquisition, construction, refinancing, renovation, and on-going operation of commercial real estate properties; commercial real estate mortgage, residential real estate mortgage, and real estate construction and land loans; commercial loans and leases, such as equipment finance, other asset-based, venture capital, secured business, warehouse, and other lending services; small business administration loans; and consumer loans comprising personal, auto, and other loans, as well as home equity and revolving lines of credit. In addition, the company offers international banking, multi-state deposit, and asset and investment management services, as well as cash and treasury management services; and online, mobile, remote deposit, and telephone banking services. It serves small and middle-market businesses, venture capital firms, non-profit organizations, business owners, entrepreneurs, professionals, and high-net worth individuals. Banc of California, Inc. was founded in 1941 and is headquartered in Los Angeles, California.