Comparing Five Star Bancorp (NASDAQ:FSBC) & First Hawaiian (NASDAQ:FHB)

First Hawaiian (NASDAQ:FHB) and Five Star Bancorp (NASDAQ:FSBC) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, dividends, valuation and analyst recommendations.

Institutional & Insider Ownership

97.6% of First Hawaiian shares are owned by institutional investors. Comparatively, 46.9% of Five Star Bancorp shares are owned by institutional investors. 0.6% of First Hawaiian shares are owned by company insiders. Comparatively, 21.7% of Five Star Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility & Risk

First Hawaiian has a beta of 0.91, indicating that its share price is 9% less volatile than the S&P 500. Comparatively, Five Star Bancorp has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500.

Dividends

First Hawaiian pays an annual dividend of $1.04 per share and has a dividend yield of 4.2%. Five Star Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 2.3%. First Hawaiian pays out 50.7% of its earnings in the form of a dividend. Five Star Bancorp pays out 29.6% 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.

Profitability

This table compares First Hawaiian and Five Star Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Hawaiian	22.60%	9.68%	1.08%
Five Star Bancorp	23.18%	13.88%	1.32%

Analyst Ratings

This is a summary of current ratings and recommmendations for First Hawaiian and Five Star Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Hawaiian	3	7	0	0	1.70
Five Star Bancorp	0	2	5	0	2.71

First Hawaiian presently has a consensus price target of $27.75, indicating a potential upside of 11.99%. Five Star Bancorp has a consensus price target of $39.40, indicating a potential upside of 12.12%. Given Five Star Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Five Star Bancorp is more favorable than First Hawaiian.

Earnings and Valuation

This table compares First Hawaiian and Five Star Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Hawaiian	$1.17 billion	2.63	$230.13 million	$2.05	12.09
Five Star Bancorp	$213.40 million	3.52	$45.67 million	$2.70	13.01

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

Summary

Five Star Bancorp beats First Hawaiian on 11 of the 16 factors compared between the two stocks.

About First Hawaiian

First Hawaiian, Inc. operates as a bank holding company for First Hawaiian Bank that provides a range of banking products and services to consumer and commercial customers in the United States. It operates in three segments: Retail Banking, Commercial Banking, and Treasury and Other. The company offers various deposit products, including checking, savings, and time deposit accounts, and other deposit accounts. It also provides residential and commercial mortgage loans, home equity lines of credit and loans, automobile loans and leases, secured and unsecured lines of credit, installment loans, small business loans and leases, and construction lending, as well as commercial lease and auto dealer financing. In addition, the company offers wealth management, personal installment, individual investment and financial planning, insurance protection, trust and estate, private banking, investment management, retirement planning, and merchant processing services, as well as consumer and commercial credit cards. The company was formerly known as BancWest Corporation and changed its name to First Hawaiian, Inc. in April 2016. First Hawaiian, Inc. was founded in 1858 and is headquartered in Honolulu, Hawaii.

About Five Star Bancorp

Five Star Bancorp operates as the bank holding company for Five Star Bank that provides a range of banking products and services to small and medium-sized businesses, professionals, and individuals in Northern California. It accepts various deposits, such as money market accounts, noninterest-bearing and interest checking accounts, savings accounts, term certificate accounts, and time deposits. The company also offers loan products, including commercial and residential real estate loans; commercial loans; commercial land loans; farmland loans; commercial and residential construction loans; and consumer and other loans, as well as operating lines of credit. In addition, it provides debit cards; and remote deposit capture, online and mobile banking, and direct deposit services. Five Star Bancorp was founded in 1999 and is headquartered in Rancho Cordova, California.