Colony Bankcorp (NASDAQ:CBAN) & Live Oak Bancshares (NASDAQ:LOB) Head to Head Analysis

Colony Bankcorp (NASDAQ:CBAN) and Live Oak Bancshares (NASDAQ:LOB) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, earnings, analyst recommendations, valuation, dividends and institutional ownership.

Volatility and Risk

Colony Bankcorp has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500. Comparatively, Live Oak Bancshares has a beta of 1.98, indicating that its share price is 98% more volatile than the S&P 500.

Institutional & Insider Ownership

50.4% of Colony Bankcorp shares are held by institutional investors. Comparatively, 64.0% of Live Oak Bancshares shares are held by institutional investors. 6.6% of Colony Bankcorp shares are held by company insiders. Comparatively, 23.4% of Live Oak Bancshares shares are held by company 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.

Profitability

This table compares Colony Bankcorp and Live Oak Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Colony Bankcorp	13.51%	9.64%	0.85%
Live Oak Bancshares	7.10%	6.88%	0.55%

Dividends

Colony Bankcorp pays an annual dividend of $0.46 per share and has a dividend yield of 2.9%. Live Oak Bancshares pays an annual dividend of $0.12 per share and has a dividend yield of 0.4%. Colony Bankcorp pays out 28.9% of its earnings in the form of a dividend. Live Oak Bancshares pays out 8.1% 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. Colony Bankcorp has raised its dividend for 7 consecutive years. Colony Bankcorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Colony Bankcorp and Live Oak Bancshares”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Colony Bankcorp	$126.05 million	2.23	$23.87 million	$1.59	10.11
Live Oak Bancshares	$533.05 million	2.79	$77.47 million	$1.49	21.81

Live Oak Bancshares has higher revenue and earnings than Colony Bankcorp. Colony Bankcorp 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 recommendations and price targets for Colony Bankcorp and Live Oak Bancshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Colony Bankcorp	0	0	1	0	3.00
Live Oak Bancshares	0	2	2	0	2.50

Colony Bankcorp currently has a consensus target price of $21.00, suggesting a potential upside of 30.63%. Live Oak Bancshares has a consensus target price of $42.50, suggesting a potential upside of 30.81%. Given Live Oak Bancshares’ higher possible upside, analysts clearly believe Live Oak Bancshares is more favorable than Colony Bankcorp.

Summary

Live Oak Bancshares beats Colony Bankcorp on 10 of the 17 factors compared between the two stocks.

About Colony Bankcorp

Colony Bankcorp, Inc. operates as the bank holding company for Colony Bank that provides various banking products and services to commercial and consumer customers. The company offers deposit products, including demand, savings, and time deposits. It also provides loans to small and medium-sized businesses; residential and commercial construction, and land development loans; commercial real estate loans; commercial loans; agri-business and production loans; residential mortgage loans; home equity loans; and consumer loans. In addition, the company offers internet banking services, electronic bill payment services, safe deposit box rentals, telephone banking, credit and debit card services, and remote depository products, as well as access to a network of ATMs. The company was founded in 1975 and is headquartered in Fitzgerald, Georgia.

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.