Pacific Valley Bank (OTCMKTS:PVBK) and CBTX (NASDAQ:CBTX) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, dividends and risk.

Profitability

This table compares Pacific Valley Bank and CBTX’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pacific Valley Bank N/A N/A N/A
CBTX 31.19% 10.14% 1.51%

Dividends

CBTX pays an annual dividend of $0.40 per share and has a dividend yield of 1.4%. Pacific Valley Bank does not pay a dividend. CBTX pays out 21.2% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Pacific Valley Bank and CBTX, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pacific Valley Bank 0 0 0 0 N/A
CBTX 0 2 0 0 2.00

CBTX has a consensus price target of $35.00, indicating a potential upside of 22.55%. Given CBTX’s higher probable upside, analysts clearly believe CBTX is more favorable than Pacific Valley Bank.

Risk and Volatility

Pacific Valley Bank has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500. Comparatively, CBTX has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500.

Insider & Institutional Ownership

28.8% of CBTX shares are held by institutional investors. 29.2% of CBTX shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Pacific Valley Bank and CBTX’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pacific Valley Bank $13.29 million 2.72 $2.46 million N/A N/A
CBTX $137.51 million 5.40 $47.29 million $1.89 15.11

CBTX has higher revenue and earnings than Pacific Valley Bank.

Summary

CBTX beats Pacific Valley Bank on 11 of the 12 factors compared between the two stocks.

Pacific Valley Bank Company Profile

Pacific Valley Bank provides personal and business banking products and services in the United States. The company offers checking, savings, money market, and individual retirement accounts, as well as certificates of deposit. It also provides business and consumer loans; debit cards; and online and mobile banking, bill pay, remote deposit capture, and bank to bank transfer services, as well as e-statements and order checks. The company was founded in 2004 and is based in Salinas, California.

CBTX Company Profile

CBTX, Inc. operates as the bank holding company for CommunityBank of Texas, National Association that provides commercial banking solutions to small and mid-sized businesses, and professionals in the United States. The company offers various deposit products, including demand, savings, money market, and time accounts; and loans, such as commercial and industrial loans, commercial real estate loans, construction and development loans, 1-4 family residential mortgage loans, multi-family residential loans, consumer loans, and agricultural loans. It also provides treasury and online banking services. CBTX, Inc. operates 35 banking locations, including 19 branches in Houston; 15 branches in Beaumont; and 1 branch in Dallas. The company was formerly known as CBFH, Inc. and changed its name to CBTX, Inc. in September 2017. CBTX, Inc. was founded in 2007 and is based in Houston, Texas.

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