Critical Contrast: OP Bancorp (NASDAQ:OPBK) vs. Private Bancorp of America (OTCMKTS:PBAM)

OP Bancorp (NASDAQ:OPBK) and Private Bancorp of America (OTCMKTS:PBAM) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, earnings, valuation, profitability, dividends, institutional ownership and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings and price targets for OP Bancorp and Private Bancorp of America, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OP Bancorp	0	2	2	0	2.50
Private Bancorp of America	0	1	3	1	3.00

OP Bancorp currently has a consensus target price of $16.50, suggesting a potential upside of 15.63%. Private Bancorp of America has a consensus target price of $86.33, suggesting a potential upside of 17.59%. Given Private Bancorp of America’s stronger consensus rating and higher probable upside, analysts plainly believe Private Bancorp of America is more favorable than OP Bancorp.

Institutional and Insider Ownership

53.6% of OP Bancorp shares are owned by institutional investors. Comparatively, 13.5% of Private Bancorp of America shares are owned by institutional investors. 20.4% of OP Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares OP Bancorp and Private Bancorp of America”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OP Bancorp	$166.66 million	1.27	$25.64 million	$1.71	8.35
Private Bancorp of America	$172.31 million	2.44	$40.67 million	$7.20	10.20

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

Profitability

This table compares OP Bancorp and Private Bancorp of America’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OP Bancorp	15.39%	11.75%	0.99%
Private Bancorp of America	24.01%	16.38%	1.66%

Risk and Volatility

OP Bancorp has a beta of 0.62, suggesting that its share price is 38% less volatile than the S&P 500. Comparatively, Private Bancorp of America has a beta of 0.02, suggesting that its share price is 98% less volatile than the S&P 500.

Summary

Private Bancorp of America beats OP Bancorp on 12 of the 15 factors compared between the two stocks.

About OP Bancorp

OP Bancorp operates as the bank holding company for Open Bank that provides banking products and services in California. It offers demand, checking, savings, money market, and time deposit accounts, as well as certificates of deposit. The company also provides commercial real estate, small business administration, commercial and industrial business, single-family residential, term, consumer, and home mortgage loans; trade financing products; and letters of credit, and SWIFT and export advice. In addition, it offers debit and credit card, online transfer and bill payment, electronic delivery of customer statements, and mobile banking solutions for iPhone and Android phones, including remote check deposit with mobile bill pay; direct deposits, cashier's checks, person to person payments, wire transfers, and automated clearing house (ACH) services; and cash management services, including balance reporting, transfers between accounts, wire transfer initiation, ACH origination, and stop payment services, as well as remote deposit capture, positive pay, zero balance accounts, and sweep accounts. The company operates full branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Gardena, Buena Park, and Santa Clara in California; and Carrollton, Texas; and operates loan production offices in Pleasanton, California; Atlanta, Georgia; Aurora, Colorado; and Lynnwood in Washington. The company was founded in 2005 and is headquartered in Los Angeles, California.

About Private Bancorp of America

Private Bancorp of America, Inc. operates as the bank holding company for CalPrivate Bank that provides banking products and services to individuals and businesses in California. The company offers checking and savings, money market, certificate of deposit, sweep, zero balance, and individual retirement accounts; unsecured lines of credit, personal credit lines, and term loans; additional services, such as direct deposits, online banking, ATM and debit cards, credit cards, savings/line of credit overdraft protection, and safe deposit boxes; and certificate of deposit account registry services. It also provides treasury management, merchant card, bill pay, positive pay, e-statement, remote deposit capture, ACH origination, wire transfer, electronic payments and collections, electronic check acceptance, account reconciliation, cash vault, and gift and business credit cards, as well as funds management services. In addition, the company offers term credit facilities and loans, equipment and business expansion loans, working capital lines of credit, commercial real estate financing, construction financing, letters of credit, business start-up loans, loans for business acquisition and partner buyouts, owner-occupied commercial real estate loans, equipment, furniture and fixture, and other loans; and CDARS And ICS products. Further, it provides wealth management and legal services. The company has offices in La Jolla, San Diego, Coronado, Newport Beach, Beverly Hills, El Segundo, Temecula, Mission Valley, and Redlands. Private Bancorp of America, Inc. was founded in 2006 and is headquartered in La Jolla, California.