First Republic Bank (NYSE: FRC) and Yadkin Financial Corp (NYSE:YDKN) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Risk and Volatility

First Republic Bank has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500. Comparatively, Yadkin Financial Corp has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500.

Insider and Institutional Ownership

97.8% of First Republic Bank shares are owned by institutional investors. Comparatively, 69.7% of Yadkin Financial Corp shares are owned by institutional investors. 3.0% of Yadkin Financial Corp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings for First Republic Bank and Yadkin Financial Corp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Republic Bank 0 8 6 0 2.43
Yadkin Financial Corp 0 0 0 0 N/A

First Republic Bank presently has a consensus price target of $102.93, suggesting a potential upside of 8.98%.

Dividends

First Republic Bank pays an annual dividend of $0.68 per share and has a dividend yield of 0.7%. Yadkin Financial Corp does not pay a dividend. First Republic Bank pays out 16.0% of its earnings in the form of a dividend. First Republic Bank has raised its dividend for 4 consecutive years.

Profitability

This table compares First Republic Bank and Yadkin Financial Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Republic Bank 26.85% 12.06% 0.94%
Yadkin Financial Corp 18.40% 5.41% 0.75%

Valuation & Earnings

This table compares First Republic Bank and Yadkin Financial Corp’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
First Republic Bank $2.38 billion 6.27 $673.42 million $4.24 22.28
Yadkin Financial Corp N/A N/A N/A $1.23 N/A

First Republic Bank has higher revenue and earnings than Yadkin Financial Corp. Yadkin Financial Corp is trading at a lower price-to-earnings ratio than First Republic Bank, indicating that it is currently the more affordable of the two stocks.

Summary

First Republic Bank beats Yadkin Financial Corp on 10 of the 12 factors compared between the two stocks.

First Republic Bank Company Profile

First Republic Bank is a commercial bank and trust company. The Bank specializes in providing services, including private banking, private business banking, real estate lending and wealth management services, including trust and custody services, to clients in selected metropolitan areas in the United States. It operates through two segments: Commercial Banking and Wealth Management. The Commercial Banking segment is engaged in attracting funds from the public; originating loans, primarily real estate secured mortgage loans, and investing in investment securities. The Wealth Management segment consists of First Republic Investment Management, Inc.; its money market mutual fund activities through third-party providers and the brokerage activities of First Republic Securities Company, LLC; First Republic Trust Company and First Republic Trust Company of Delaware LLC (the Trust Company), and its foreign exchange activities. It offers a range of internally managed investment services.

Yadkin Financial Corp Company Profile

Yadkin Financial Corporation is a bank holding company. The Company conducts its business operations through its subsidiary, Yadkin Bank, which is a chartered community bank that provides services in approximately 110 branches across North Carolina and South Carolina. Yadkin Bank provides banking, mortgage, investment and insurance services to businesses and consumers across the Carolinas. It operates through a segment, which is providing general commercial banking and financial services to individuals and businesses located in North Carolina and South Carolina, and to customers in various states through its Small Business Administration (SBA) lending program. It offers various loans, such as commercial and industrial (C&I) loans and government-guaranteed loans. The Company’s investment securities portfolio includes the United States Government-sponsored enterprise (GSE) obligations and securities guaranteed by the United States SBA. The Company’s primary source of funds is deposits.

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