Analyzing OP Bancorp (NASDAQ:OPBK) & American Business Bank (OTCMKTS:AMBZ)

OP Bancorp (NASDAQ:OPBK) and American Business Bank (OTCMKTS:AMBZ) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, analyst recommendations, valuation, risk and profitability.

Profitability

This table compares OP Bancorp and American Business Bank’s 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%
American Business Bank	25.23%	N/A	N/A

Analyst Recommendations

This is a breakdown of current recommendations for OP Bancorp and American Business Bank, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OP Bancorp	0	2	1	0	2.33
American Business Bank	0	0	0	0	0.00

OP Bancorp presently has a consensus price target of $15.50, suggesting a potential upside of 18.14%. Given OP Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe OP Bancorp is more favorable than American Business Bank.

Risk & Volatility

OP Bancorp has a beta of 0.7, indicating that its stock price is 30% less volatile than the S&P 500. Comparatively, American Business Bank has a beta of 0.47, indicating that its stock price is 53% less volatile than the S&P 500.

Valuation & Earnings

This table compares OP Bancorp and American Business Bank”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OP Bancorp	$154.05 million	1.27	$21.07 million	$1.48	8.86
American Business Bank	$183.26 million	2.67	$43.28 million	$5.18	10.60

American Business Bank has higher revenue and earnings than OP Bancorp. OP Bancorp is trading at a lower price-to-earnings ratio than American Business Bank, 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 3.7%. American Business Bank pays an annual dividend of $1.00 per share and has a dividend yield of 1.8%. OP Bancorp pays out 32.4% of its earnings in the form of a dividend. American Business Bank pays out 19.3% 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.

Insider & Institutional Ownership

53.6% of OP Bancorp shares are held by institutional investors. Comparatively, 9.9% of American Business Bank shares are held by institutional investors. 20.4% of OP Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

OP Bancorp beats American Business Bank 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 American Business Bank

American Business Bank, a California-chartered bank, provides banking products and services to small and medium-sized firms, non-profits, business executives, and professionals in Southern California. The company offers credit and depository; treasury management; asset-based lending; SBA lending; international banking comprising money transfers, import and export commercial letters of credit, standby letters of credit, documentary and clean collections, and foreign currency exchange services; and consulting and referral services. It operates regional loan production offices located in North Orange County, Orange County, South Bay, San Fernando Valley, Riverside County, Inland Empire, and Long Beach. American Business Bank was incorporated in 1998 and is headquartered in Los Angeles, California.