Head to Head Comparison: Hanmi Financial (NASDAQ:HAFC) versus RBB Bancorp (NASDAQ:RBB)

Hanmi Financial (NASDAQ:HAFC) and RBB Bancorp (NASDAQ:RBB) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, dividends, risk, earnings and valuation.

Risk & Volatility

Hanmi Financial has a beta of 0.76, suggesting that its share price is 24% less volatile than the S&P 500. Comparatively, RBB Bancorp has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500.

Dividends

Hanmi Financial pays an annual dividend of $1.08 per share and has a dividend yield of 4.6%. RBB Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 3.3%. Hanmi Financial pays out 50.2% of its earnings in the form of a dividend. RBB Bancorp pays out 49.6% 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. Hanmi Financial has increased its dividend for 1 consecutive years. Hanmi Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Hanmi Financial and RBB Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hanmi Financial	15.11%	8.77%	0.84%
RBB Bancorp	9.80%	4.50%	0.57%

Valuation & Earnings

This table compares Hanmi Financial and RBB Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hanmi Financial	$430.37 million	1.65	$62.20 million	$2.15	10.98
RBB Bancorp	$232.00 million	1.44	$26.67 million	$1.29	15.00

Hanmi Financial has higher revenue and earnings than RBB Bancorp. Hanmi Financial is trading at a lower price-to-earnings ratio than RBB Bancorp, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

88.7% of Hanmi Financial shares are owned by institutional investors. Comparatively, 40.1% of RBB Bancorp shares are owned by institutional investors. 1.9% of Hanmi Financial shares are owned by insiders. Comparatively, 4.6% of RBB Bancorp 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 summary of recent recommendations and price targets for Hanmi Financial and RBB Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hanmi Financial	0	3	2	0	2.40
RBB Bancorp	0	3	0	0	2.00

Hanmi Financial presently has a consensus target price of $26.00, suggesting a potential upside of 10.17%. RBB Bancorp has a consensus target price of $21.3333, suggesting a potential upside of 10.25%. Given RBB Bancorp’s higher possible upside, analysts clearly believe RBB Bancorp is more favorable than Hanmi Financial.

Summary

Hanmi Financial beats RBB Bancorp on 12 of the 17 factors compared between the two stocks.

About Hanmi Financial

Hanmi Financial Corporation operates as the holding company for Hanmi Bank that provides business banking products and services in the United States. It offers various deposit products, including noninterest-bearing checking accounts, savings accounts, negotiable order of withdrawal accounts, money market accounts, and certificates of deposit. The company also provides real estate loans, such as commercial property, construction, and residential property loans; and commercial and industrial loans, such as commercial term loans and commercial lines of credit; and international finance and trade services and products, such as letters of credit, and import and export financing. In addition, it offers small business administration loans for business purposes, which comprise owner-occupied commercial real estate, business acquisitions, start-ups, franchise financing, working capital, improvements and renovations, inventory and equipment, and debt-refinancing, as well as equipment lease financing. The company was founded in 1982 and is headquartered in Los Angeles, California.

About RBB Bancorp

RBB Bancorp operates as the bank holding company for Royal Business Bank that provides various banking products and services to the Chinese-American, Korean-American, and other Asian-American communities. Its deposit products include checking, savings, and money market accounts, as well as certificates of deposit. The company also offers commercial and industrial lines of credit, term loans, mortgage warehouse lines, and international trade discounts; commercial real estate loans; residential, commercial, and land acquisition and development construction loans; small business administration loans; and single-family residential mortgage loans. In addition, it provides international letters of credit, SWIFT, export advisory, trade finance discount, and foreign exchange services; and remote deposit, e-banking, and mobile banking services. The company serves individuals, businesses, municipalities, and other entities. It operates branches in the Western region with branches in Los Angeles County, California; Orange County, California; Ventura County, California; Clark County, Nevada; Honolulu, Hawaii, as well as in Eastern region with branches in Manhattan, Brooklyn and Queens, New York; Chicago, Illinois; and Edison, New Jersey. RBB Bancorp was founded in 2008 and is headquartered in Los Angeles, California.