Contrasting OP Bancorp (NASDAQ:OPBK) and Southside Bancshares (NYSE:SBSI)

OP Bancorp (NASDAQ:OPBK) and Southside Bancshares (NYSE:SBSI) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, risk, earnings, profitability, analyst recommendations, dividends and valuation.

Profitability

This table compares OP Bancorp and Southside Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OP Bancorp	13.91%	10.72%	0.91%
Southside Bancshares	19.07%	10.59%	1.02%

Valuation & Earnings

This table compares OP Bancorp and Southside Bancshares”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OP Bancorp	$88.02 million	2.46	$21.07 million	$1.48	9.82
Southside Bancshares	$456.07 million	1.99	$88.49 million	$2.82	10.70

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

Dividends

OP Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 3.3%. Southside Bancshares pays an annual dividend of $1.44 per share and has a dividend yield of 4.8%. OP Bancorp pays out 32.4% of its earnings in the form of a dividend. Southside Bancshares pays out 51.1% 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. Southside Bancshares has raised its dividend for 30 consecutive years. Southside Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

OP Bancorp has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500. Comparatively, Southside Bancshares has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for OP Bancorp and Southside Bancshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OP Bancorp	0	2	0	0	2.00
Southside Bancshares	0	0	0	0	0.00

OP Bancorp presently has a consensus target price of $15.50, suggesting a potential upside of 6.68%. Given OP Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe OP Bancorp is more favorable than Southside Bancshares.

Insider & Institutional Ownership

53.6% of OP Bancorp shares are held by institutional investors. Comparatively, 55.7% of Southside Bancshares shares are held by institutional investors. 20.4% of OP Bancorp shares are held by insiders. Comparatively, 6.0% of Southside Bancshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Southside Bancshares beats OP Bancorp on 9 of the 16 factors compared between the two stocks.

About OP Bancorp

OP Bancorp operates as the bank holding company for Open Bank that provides banking products and services in California. It offers demand, checking, savings, money market, and time deposit accounts, as well as certificates of deposit. The company also provides commercial real estate, small business administration, commercial and industrial business, single-family residential, term, consumer, and home mortgage loans; trade financing products; and letters of credit, and SWIFT and export advice. In addition, it offers debit and credit card, online transfer and bill payment, electronic delivery of customer statements, and mobile banking solutions for iPhone and Android phones, including remote check deposit with mobile bill pay; direct deposits, cashier's checks, person to person payments, wire transfers, and automated clearing house (ACH) services; and cash management services, including balance reporting, transfers between accounts, wire transfer initiation, ACH origination, and stop payment services, as well as remote deposit capture, positive pay, zero balance accounts, and sweep accounts. The company operates full branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Gardena, Buena Park, and Santa Clara in California; and Carrollton, Texas; and operates loan production offices in Pleasanton, California; Atlanta, Georgia; Aurora, Colorado; and Lynnwood in Washington. The company was founded in 2005 and is headquartered in Los Angeles, California.

About Southside Bancshares

Southside Bancshares, Inc. operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposit. The company’s loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other consumer related loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate. It also offers wealth management and trust services consisting of investment management, administration, revocable and testamentary trusts, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. As of December 31, 2021, the company operated through 56 banking facilities and 73 ATMs/ITMs. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.