Head to Head Review: CPB (NYSE:CPF) and Malaga Financial (OTCMKTS:MLGF)

CPB (NYSE:CPF) and Malaga Financial (OTCMKTS:MLGF) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Analyst Ratings

This is a summary of recent ratings for CPB and Malaga Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CPB	0	0	1	0	3.00
Malaga Financial	0	0	0	0	0.00

CPB currently has a consensus target price of $35.00, suggesting a potential upside of 14.03%. Given CPB’s stronger consensus rating and higher possible upside, equities research analysts clearly believe CPB is more favorable than Malaga Financial.

Profitability

This table compares CPB and Malaga Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CPB	17.31%	12.80%	0.95%
Malaga Financial	N/A	N/A	N/A

Risk and Volatility

CPB has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500. Comparatively, Malaga Financial has a beta of 0.14, suggesting that its stock price is 86% less volatile than the S&P 500.

Dividends

CPB pays an annual dividend of $1.08 per share and has a dividend yield of 3.5%. Malaga Financial pays an annual dividend of $1.00 per share and has a dividend yield of 4.9%. CPB pays out 48.4% of its earnings in the form of a dividend. Malaga Financial pays out 43.3% 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. CPB has increased its dividend for 1 consecutive years. Malaga Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

88.4% of CPB shares are held by institutional investors. Comparatively, 1.2% of Malaga Financial shares are held by institutional investors. 2.4% of CPB shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CPB	$344.82 million	2.40	$53.41 million	$2.23	13.76
Malaga Financial	N/A	N/A	$22.65 million	$2.31	8.84

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

Summary

CPB beats Malaga Financial on 13 of the 16 factors compared between the two stocks.

About CPB

Central Pacific Financial Corp. operates as the bank holding company for Central Pacific Bank that provides a range of commercial banking products and services to businesses, professionals, and individuals in the United States. It offers various deposit products and services, including checking, savings and time deposits, cash management and digital banking, trust, and retail brokerage services, as well as money market accounts and certificates of deposit. The company also provides various lending activities, such as commercial, commercial and residential mortgage, home equity, and consumer loans; and other products and services comprising debit cards, internet and mobile banking, cash management services, full-service ATMs, safe deposit boxes, international banking services, night depository facilities, foreign exchange, and wire transfers. In addition, it offers wealth management products and services that include non-deposit investment products, annuities, insurance, investment management, asset custody and general consultation, and planning services. The company was founded in 1954 and is headquartered in Honolulu, Hawaii.

About Malaga Financial

Malaga Financial Corporation operates as the holding company for Malaga Bank that provides various community banking products and services to personal and business customers. It offers checking, savings, NOW, and money market accounts, certificates of deposits, business banking, consumer, and demand deposits. The company also provides commercial real estate, single and multi-family residential mortgage, consumer, 14-unit investment property, construction, personal, and business loans; home equity lines of credit; and certificates of deposit. In addition, it offers coupon redemption, direct deposit, overdraft lines of credit, telephone transfers, U.S. savings bond redemption, and wire transfer services; and ATM and VISA debit cards, bank by mail, medallion signature guarantee, night depository, notary, safe deposit boxes, and trust deed note collection services. Further, the company provides online banking services, including bill payer, e-statements, and mobile banking services. The company was incorporated in 2002 and is headquartered in Palos Verdes Estates, California.