Private Bancorp of America (OTCMKTS:PBAM – Get Free Report) and Farmers & Merchants Bancorp (OTCMKTS:FMCB – Get Free Report) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, dividends, valuation, earnings, analyst recommendations and profitability.
Profitability
This table compares Private Bancorp of America and Farmers & Merchants Bancorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Private Bancorp of America | 24.17% | 18.26% | 1.68% |
| Farmers & Merchants Bancorp | 30.61% | 15.03% | 1.64% |
Earnings & Valuation
This table compares Private Bancorp of America and Farmers & Merchants Bancorp”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Private Bancorp of America | $161.24 million | 2.06 | $35.82 million | $7.02 | 8.16 |
| Farmers & Merchants Bancorp | $292.68 million | 2.55 | $88.46 million | $126.87 | 8.17 |
Farmers & Merchants Bancorp has higher revenue and earnings than Private Bancorp of America. Private Bancorp of America is trading at a lower price-to-earnings ratio than Farmers & Merchants Bancorp, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent recommendations for Private Bancorp of America and Farmers & Merchants Bancorp, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Private Bancorp of America | 0 | 1 | 1 | 1 | 3.00 |
| Farmers & Merchants Bancorp | 0 | 0 | 0 | 0 | 0.00 |
Private Bancorp of America presently has a consensus target price of $80.00, suggesting a potential upside of 39.64%. Given Private Bancorp of America’s stronger consensus rating and higher probable upside, equities analysts clearly believe Private Bancorp of America is more favorable than Farmers & Merchants Bancorp.
Insider and Institutional Ownership
13.5% of Private Bancorp of America shares are owned by institutional investors. Comparatively, 5.6% of Farmers & Merchants Bancorp shares are owned by institutional investors. 8.5% of Farmers & Merchants Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Risk & Volatility
Private Bancorp of America has a beta of 0.3, suggesting that its stock price is 70% less volatile than the S&P 500. Comparatively, Farmers & Merchants Bancorp has a beta of 0.24, suggesting that its stock price is 76% less volatile than the S&P 500.
Summary
Private Bancorp of America beats Farmers & Merchants Bancorp on 8 of the 15 factors compared between the two stocks.
About Private Bancorp of America
Private Bancorp of America, Inc. operates as the bank holding company for CalPrivate Bank that provides banking products and services to individuals and businesses in California. The company offers checking and savings, money market, certificate of deposit, sweep, zero balance, and individual retirement accounts; unsecured lines of credit, personal credit lines, and term loans; additional services, such as direct deposits, online banking, ATM and debit cards, credit cards, savings/line of credit overdraft protection, and safe deposit boxes; and certificate of deposit account registry services. It also provides treasury management, merchant card, bill pay, positive pay, e-statement, remote deposit capture, ACH origination, wire transfer, electronic payments and collections, electronic check acceptance, account reconciliation, cash vault, and gift and business credit cards, as well as funds management services. In addition, the company offers term credit facilities and loans, equipment and business expansion loans, working capital lines of credit, commercial real estate financing, construction financing, letters of credit, business start-up loans, loans for business acquisition and partner buyouts, owner-occupied commercial real estate loans, equipment, furniture and fixture, and other loans; and CDARS And ICS products. Further, it provides wealth management and legal services. The company has offices in La Jolla, San Diego, Coronado, Newport Beach, Beverly Hills, El Segundo, Temecula, Mission Valley, and Redlands. Private Bancorp of America, Inc. was founded in 2006 and is headquartered in La Jolla, California.
About Farmers & Merchants Bancorp
Farmers & Merchants Bancorp operates as the bank holding company for Farmers & Merchants Bank of Central California that provides various banking services to businesses and individuals. The company accepts various deposit products, including checking, savings, money market, time certificates of deposit, and individual retirement accounts. It also offers range of lending products comprising commercial and residential real estate, real estate construction, agribusiness, and consumer loans, as well as equipment leases and credit card services; commercial products, including term loans, lines of credit and other working capital financing, and letters of credit; and financing products, such as automobile financing, home improvement, and home equity lines of credit. In addition, the company provides various specialized services consisting of credit card programs for merchants, lockbox and other collection services, account reconciliation, investment sweep, online account access, and electronic funds transfers through domestic and international wire and automated clearinghouse; online banking services; and investment products, such as mutual funds and annuities. The company was founded in 1916 and is headquartered in Lodi, California.
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