Analyzing Banc of California (NYSE:BANC) and Red River Bancshares (NASDAQ:RRBI)

Banc of California (NYSE:BANC) and Red River Bancshares (NASDAQ:RRBI) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their risk, institutional ownership, earnings, dividends, valuation, analyst recommendations and profitability.

Profitability

This table compares Banc of California and Red River Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banc of California	8.30%	7.37%	0.65%
Red River Bancshares	23.62%	11.76%	1.23%

Institutional & Insider Ownership

86.9% of Banc of California shares are held by institutional investors. Comparatively, 27.6% of Red River Bancshares shares are held by institutional investors. 2.7% of Banc of California shares are held by insiders. Comparatively, 15.9% of Red River 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.

Earnings and Valuation

This table compares Banc of California and Red River Bancshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banc of California	$1.89 billion	1.29	$126.89 million	$0.65	25.44
Red River Bancshares	$157.67 million	2.80	$34.24 million	$5.67	11.67

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

Dividends

Banc of California pays an annual dividend of $0.40 per share and has a dividend yield of 2.4%. Red River Bancshares pays an annual dividend of $0.60 per share and has a dividend yield of 0.9%. Banc of California pays out 61.5% of its earnings in the form of a dividend. Red River Bancshares pays out 10.6% 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. Red River Bancshares has increased its dividend for 3 consecutive years.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Banc of California and Red River Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banc of California	0	3	8	0	2.73
Red River Bancshares	0	0	1	0	3.00

Banc of California presently has a consensus target price of $17.45, suggesting a potential upside of 5.56%. Red River Bancshares has a consensus target price of $67.00, suggesting a potential upside of 1.24%. Given Banc of California’s higher probable upside, research analysts plainly believe Banc of California is more favorable than Red River Bancshares.

Volatility and Risk

Banc of California has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500. Comparatively, Red River Bancshares has a beta of 0.53, suggesting that its stock price is 47% less volatile than the S&P 500.

Summary

Red River Bancshares beats Banc of California on 9 of the 17 factors compared between the two stocks.

About Banc of California

Banc of California, Inc. operates as the bank holding company for Banc of California that provides various banking products and services in California. The company offers deposit products, such as checking, savings, money market, demand, and time deposits; certificates of deposit; retirement accounts; and safe deposit boxes. It also provides real estate loans to professional developers and real estate investors for the acquisition, construction, refinancing, renovation, and on-going operation of commercial real estate properties; commercial real estate mortgage, residential real estate mortgage, and real estate construction and land loans; commercial loans and leases, such as equipment finance, other asset-based, venture capital, secured business, warehouse, and other lending services; small business administration loans; and consumer loans comprising personal, auto, and other loans, as well as home equity and revolving lines of credit. In addition, the company offers international banking, multi-state deposit, and asset and investment management services, as well as cash and treasury management services; and online, mobile, remote deposit, and telephone banking services. It serves small and middle-market businesses, venture capital firms, non-profit organizations, business owners, entrepreneurs, professionals, and high-net worth individuals. Banc of California, Inc. was founded in 1941 and is headquartered in Los Angeles, California.

About Red River Bancshares

Red River Bancshares, Inc. operates as a bank holding company for Red River Bank that provides banking products and services to commercial and retail customers in Louisiana. The company provides various deposit products, including checking, saving, money market accounts, and time deposits. It offers commercial real estate loans; one-to-four family mortgage loans and home equity lines of credit; construction and development loans; commercial and industrial loans; small business administration paycheck protection program loans; tax-exempt loans; consumer loans to individuals for personal, family, and household purposes, including secured and unsecured installment and term loans; home mortgage loans; and lines of credit and standby letters of credit. In addition, the company provides treasury management, private banking, and brokerage; investment advisory, financial planning, and a suite of retirement plans; debit and credit cards, direct deposits, cashier's checks, and wire transfer services; online banking services, including access to account balances, online transfers, online bill payment, and electronic delivery of customer statements; and banking services in person, through ATMs, drive-through facilities, night deposits, telephone, mail, mobile banking, and remote deposits. Red River Bancshares, Inc. was incorporated in 1998 and is headquartered in Alexandria, Louisiana.