TrustCo Bank Corp NY (NASDAQ: TRST) and Banc of California (NYSE:BANC) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.

Dividends

TrustCo Bank Corp NY pays an annual dividend of $0.26 per share and has a dividend yield of 2.9%. Banc of California pays an annual dividend of $0.52 per share and has a dividend yield of 2.5%. TrustCo Bank Corp NY pays out 54.2% of its earnings in the form of a dividend. Banc of California pays out 49.1% 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.

Insider & Institutional Ownership

57.2% of TrustCo Bank Corp NY shares are owned by institutional investors. 0.2% of TrustCo Bank Corp NY shares are owned by company insiders. Comparatively, 16.9% of Banc of California shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares TrustCo Bank Corp NY and Banc of California’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
TrustCo Bank Corp NY $180.37 million 4.85 $42.60 million $0.48 18.96
Banc of California $656.85 million 1.61 $115.41 million $1.06 19.76

Banc of California has higher revenue and earnings than TrustCo Bank Corp NY. TrustCo Bank Corp NY is trading at a lower price-to-earnings ratio than Banc of California, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations and price targets for TrustCo Bank Corp NY and Banc of California, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TrustCo Bank Corp NY 0 1 0 0 2.00
Banc of California 0 1 2 0 2.67

TrustCo Bank Corp NY currently has a consensus price target of $7.25, indicating a potential downside of 20.33%. Banc of California has a consensus price target of $22.00, indicating a potential upside of 5.01%. Given Banc of California’s stronger consensus rating and higher possible upside, analysts clearly believe Banc of California is more favorable than TrustCo Bank Corp NY.

Risk & Volatility

TrustCo Bank Corp NY has a beta of 1.2, meaning that its stock price is 20% more volatile than the S&P 500. Comparatively, Banc of California has a beta of 0.95, meaning that its stock price is 5% less volatile than the S&P 500.

Profitability

This table compares TrustCo Bank Corp NY and Banc of California’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TrustCo Bank Corp NY 25.16% 10.51% 0.95%
Banc of California 15.48% 11.78% 0.80%

Summary

Banc of California beats TrustCo Bank Corp NY on 9 of the 16 factors compared between the two stocks.

TrustCo Bank Corp NY Company Profile

TrustCo Bank Corp NY is a savings and loan holding company. The Company’s principal subsidiary is Trustco Bank (the Bank). The Bank is a federal savings bank engaged in providing general banking services to individuals, partnerships and corporations. It operates through community banking segment. The Bank’s business consists of accepting deposits and making loans and investments. The Bank provides both personal and business banking services. The Bank’s subsidiary, Trustco Realty Corp., is a real estate investment trust (REIT) formed to acquire, hold and manage real estate mortgage assets, including residential mortgage loans and mortgage backed securities. The Bank’s trust department operates under the name, Trustco Financial Services, and serves as executor of estates and trustee of personal trusts, provides asset and wealth management services, and provides estate planning and related advice, provides custodial services.

Banc of California Company Profile

Banc of California, Inc. is a financial holding company. The Company is the parent of Banc of California, National Association (the Bank). The Company operates through Commercial Banking; Mortgage Banking, and Corporate/Other segments. As of December 31, 2016, the Bank had 90 California banking locations, including 39 full service branches in San Diego, Orange, Santa Barbara, and Los Angeles Counties. The Bank offers automated bill payment, cash and treasury management, master demand accounts, foreign exchange, interest rate swaps, trust services, card payment services, remote and mobile deposit capture, automatic clearing house (ACH) origination, wire transfer, direct deposit, and safe deposit boxes. Bank customers also have the ability to access their accounts through a nationwide network of automated teller machines (ATMs), online, telephone and mobile banking. The Bank’s lending activities are focused on providing financing to private businesses, entrepreneurs and homeowners.

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