Cathay General Bancorp (CATY) & The Competition Critical Review

Cathay General Bancorp (NASDAQ:CATY) is one of 919 public companies in the “Banks” industry, but how does it contrast to its rivals? We will compare Cathay General Bancorp to similar businesses based on the strength of its profitability, risk, valuation, analyst recommendations, dividends, earnings and institutional ownership.

Dividends

Cathay General Bancorp pays an annual dividend of $1.52 per share and has a dividend yield of 2.3%. Cathay General Bancorp pays out 28.0% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 8.9% and pay out 28.9% of their earnings in the form of a dividend.

Institutional & Insider Ownership

75.0% of Cathay General Bancorp shares are held by institutional investors. Comparatively, 48.0% of shares of all “Banks” companies are held by institutional investors. 4.5% of Cathay General Bancorp shares are held by company insiders. Comparatively, 9.7% of shares of all “Banks” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Cathay General Bancorp and its rivals top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Cathay General Bancorp	$1.38 billion	$315.12 million	12.08
Cathay General Bancorp Competitors	$9.95 billion	$2.42 billion	21.14

Cathay General Bancorp’s rivals have higher revenue and earnings than Cathay General Bancorp. Cathay General Bancorp is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

Cathay General Bancorp has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500. Comparatively, Cathay General Bancorp’s rivals have a beta of 0.61, indicating that their average stock price is 39% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Cathay General Bancorp and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cathay General Bancorp	1	5	1	0	2.00
Cathay General Bancorp Competitors	7497	30259	27867	1491	2.35

Cathay General Bancorp presently has a consensus price target of $62.25, indicating a potential downside of 4.94%. As a group, “Banks” companies have a potential upside of 14.70%. Given Cathay General Bancorp’s rivals stronger consensus rating and higher possible upside, analysts clearly believe Cathay General Bancorp has less favorable growth aspects than its rivals.

Profitability

This table compares Cathay General Bancorp and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cathay General Bancorp	25.32%	12.14%	1.48%
Cathay General Bancorp Competitors	15.62%	9.43%	0.93%

Summary

Cathay General Bancorp rivals beat Cathay General Bancorp on 9 of the 15 factors compared.

About Cathay General Bancorp

Cathay General Bancorp is a bank holding company whose principal subsidiary is Cathay Bank. Founded in Los Angeles in 1962, Cathay Bank initially served the Chinese American community and has since expanded its customer base and operations. The bank provides commercial and consumer banking services, including deposit accounts, business and personal loans, residential mortgage lending, and cash-management and trade-finance services. Customers can also access banking through digital channels. Cathay Bank serves individuals and businesses across several U.S. states, with a presence in markets including California, New York, Illinois, Texas, and Washington.