Reviewing United Bancorporation of Alabama (OTCMKTS:UBAB) & Commonwealth Business Bank (OTCMKTS:CBBI)

Commonwealth Business Bank (OTCMKTS:CBBI) and United Bancorporation of Alabama (OTCMKTS:UBAB) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.

Institutional & Insider Ownership

5.5% of United Bancorporation of Alabama shares are owned by institutional investors. 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.

Volatility and Risk

Commonwealth Business Bank has a beta of 0.19, meaning that its stock price is 81% less volatile than the S&P 500. Comparatively, United Bancorporation of Alabama has a beta of 0.43, meaning that its stock price is 57% less volatile than the S&P 500.

Profitability

This table compares Commonwealth Business Bank and United Bancorporation of Alabama’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Commonwealth Business Bank	15.89%	N/A	N/A
United Bancorporation of Alabama	22.18%	14.56%	1.53%

Dividends

Commonwealth Business Bank pays an annual dividend of $0.50 per share and has a dividend yield of 4.5%. United Bancorporation of Alabama pays an annual dividend of $1.40 per share and has a dividend yield of 2.7%. Commonwealth Business Bank pays out 27.8% of its earnings in the form of a dividend. United Bancorporation of Alabama pays out 23.1% 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.

Earnings and Valuation

This table compares Commonwealth Business Bank and United Bancorporation of Alabama”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Commonwealth Business Bank	$122.69 million	N/A	$22.43 million	$1.80	6.13
United Bancorporation of Alabama	$97.72 million	1.64	$28.00 million	$6.07	8.62

United Bancorporation of Alabama has lower revenue, but higher earnings than Commonwealth Business Bank. Commonwealth Business Bank is trading at a lower price-to-earnings ratio than United Bancorporation of Alabama, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Commonwealth Business Bank and United Bancorporation of Alabama, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Commonwealth Business Bank	0	0	0	0	0.00
United Bancorporation of Alabama	0	1	0	0	2.00

Summary

United Bancorporation of Alabama beats Commonwealth Business Bank on 10 of the 12 factors compared between the two stocks.

About Commonwealth Business Bank

CBB Bancorp, Inc. operates as the holding company for Commonwealth Business Bank that provides various commercial banking products and services to individuals and businesses in the United States. It offers checking, savings, money market, and certification of deposit accounts; SBA lending; business lines of credit; business term loans; business and commercial property loans; construction loans; and credit cards. The company also provides treasury management, and mobile and online banking services, as well as title and escrow services. In addition, it engages in investing activities; and offers trade finance services, including commercial letters of credit, standby letters of credit, and documentary collection services. The company offers its services through full-service and limited-service branches in Southern California, Dallas, Texas and Honolulu, and Hawaii; and loan production offices in the states of Colorado, Georgia, Texas, and Washington. CBB Bancorp, Inc. was founded in 2005 and is headquartered in Los Angeles, California.

About United Bancorporation of Alabama

United Bancorporation of Alabama, Inc. operates as the bank holding company for United Bank that provides banking services. The company offers checking and savings accounts, certificates of deposit, individual retirement accounts, small business programs, business solutions, merchant services, and cash management services. It also provides various lending services, such as personal loans, business loans, lines of credit, and equipment loans; real estate loans for the agricultural community and working lines of credit; and overdraft services. In addition, the company offers debit cards, prepaid cards, Visa credit cards, gift cards, and safe deposit boxes. Further, it provides check cashing, convenience, remote deposit, mobile check deposit, personal storage compartments, Web payment options, insurance products, investment and brokerage, and online and mobile banking services. United Bancorporation of Alabama, Inc. was founded in 1904 and is based in Atmore, Alabama.