Head-To-Head Analysis: East West Bancorp (NASDAQ:EWBC) & City Bank (OTCMKTS:CTBK)

East West Bancorp (NASDAQ:EWBC) and City Bank (OTCMKTS:CTBK) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, earnings, valuation, risk, profitability and dividends.

Insider and Institutional Ownership

89.5% of East West Bancorp shares are held by institutional investors. 0.9% of East West Bancorp shares are held by insiders. Comparatively, 37.5% of City Bank shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares East West Bancorp and City Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
East West Bancorp	29.59%	16.00%	1.73%
City Bank	N/A	N/A	N/A

Volatility and Risk

East West Bancorp has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500. Comparatively, City Bank has a beta of -0.22, indicating that its share price is 122% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for East West Bancorp and City Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
East West Bancorp	0	5	11	0	2.69
City Bank	0	0	0	0	0.00

East West Bancorp presently has a consensus price target of $132.36, indicating a potential upside of 7.62%. Given East West Bancorp’s stronger consensus rating and higher probable upside, equities analysts plainly believe East West Bancorp is more favorable than City Bank.

Valuation & Earnings

This table compares East West Bancorp and City Bank”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
East West Bancorp	$2.98 billion	5.65	$1.33 billion	$10.01	12.29
City Bank	N/A	N/A	N/A	N/A	N/A

East West Bancorp has higher revenue and earnings than City Bank.

Summary

East West Bancorp beats City Bank on 9 of the 10 factors compared between the two stocks.

About East West Bancorp

East West Bancorp, Inc. operates as the bank holding company for East West Bank that provides a range of personal and commercial banking services to businesses and individuals in the United States. The company operates through three segments: Consumer and Business Banking, Commercial Banking, and Other. It accepts various deposit products, such as personal and business checking and savings accounts, money market, and time deposits. The company’s loan products include mortgage and home equity, commercial and residential real estate, working capital lines of credit, construction finance, trade finance, letters of credit, commercial business, affordable housing loans, asset-based lending, asset-backed finance, project finance, loan syndication, and equipment financing, as well as financing services for clients to facilitate their business transactions between the United States and Asia. It also provides various wealth management, treasury management, foreign exchange, and interest rate and commodity risk hedging services; and mobile and online banking services. The company was founded in 1973 and is headquartered in Pasadena, California.

About City Bank

As of April 17, 2010, City Bank was acquired by Whidbey Island Bank. City Bank offers commercial banking services. The company was incorporated in 1974 and is headquartered in Lynnwood, Washington.