Citizens (NASDAQ:CIZN – Get Free Report) and Live Oak Bancshares (NASDAQ:LOB – Get Free Report) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, risk, profitability and earnings.
Institutional & Insider Ownership
9.7% of Citizens shares are held by institutional investors. Comparatively, 64.0% of Live Oak Bancshares shares are held by institutional investors. 8.9% of Citizens shares are held by insiders. Comparatively, 23.4% of Live Oak Bancshares shares are held 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.
Volatility and Risk
Citizens has a beta of -0.02, indicating that its stock price is 102% less volatile than the S&P 500. Comparatively, Live Oak Bancshares has a beta of 1.75, indicating that its stock price is 75% more volatile than the S&P 500.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Citizens | 7.00% | 11.28% | 0.37% |
| Live Oak Bancshares | 7.10% | 6.88% | 0.55% |
Dividends
Citizens pays an annual dividend of $0.08 per share and has a dividend yield of 1.2%. Live Oak Bancshares pays an annual dividend of $0.12 per share and has a dividend yield of 0.3%. Citizens pays out 8.4% of its earnings in the form of a dividend. Live Oak Bancshares pays out 9.8% 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. Citizens has increased its dividend for 1 consecutive years. Citizens is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares Citizens and Live Oak Bancshares”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Citizens | $40.95 million | 0.92 | $5.49 million | $0.95 | 7.04 |
| Live Oak Bancshares | $516.93 million | 3.20 | $77.47 million | $1.22 | 29.61 |
Live Oak Bancshares has higher revenue and earnings than Citizens. Citizens is trading at a lower price-to-earnings ratio than Live Oak Bancshares, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of current ratings for Citizens and Live Oak Bancshares, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Citizens | 0 | 0 | 1 | 0 | 3.00 |
| Live Oak Bancshares | 0 | 2 | 3 | 0 | 2.60 |
Citizens currently has a consensus price target of $23.00, indicating a potential upside of 244.05%. Live Oak Bancshares has a consensus price target of $45.00, indicating a potential upside of 24.55%. Given Citizens’ stronger consensus rating and higher possible upside, equities analysts plainly believe Citizens is more favorable than Live Oak Bancshares.
Summary
Live Oak Bancshares beats Citizens on 11 of the 17 factors compared between the two stocks.
About Citizens
Citizens Holding Company operates as the bank holding company for The Citizens Bank of Philadelphia that provides various commercial and personal banking products and services. It offers demand deposits; and savings and time deposit accounts. The company also provides secured and unsecured loans; mortgage loans; single and multi-family housing, farm, residential and commercial construction, and commercial real estate loans; commercial, industrial, and agricultural production loans; and consumer loans, as well as issues letters of credit. In addition, it offers personal and corporate trust services; credit life and title insurance; and online and mobile banking services. The company was founded in 1908 and is headquartered in Philadelphia, Mississippi.
About Live Oak Bancshares
Live Oak Bancshares, Inc. operates as the bank holding company for Live Oak Banking Company that provides various banking products and services in the United States. It operates through two segments, Banking and Fintech. The company accepts various deposit products, including noninterest-bearing demand, as well as interest-bearing checking, money market, savings, and time deposits. It also offers commercial and industrial loans; construction and development loans; owner occupied and non-owner occupied collateral commercial real estate loans; and commercial land loans. In addition, the company provides settlement, accounting, and securitization services for government guaranteed loans; financing for renewable energy application industry; wealth and investment management services to high-net-worth individuals and families; and investment advisory services to a series of funds focused on providing venture capital to new and emerging financial technology companies. Live Oak Bancshares, Inc. was incorporated in 2008 and is headquartered in Wilmington, North Carolina.
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