Analysis of First Foundation (NASDAQ:FFWM) and PCB Bancorp (NASDAQ:PCB)


First Foundation (NASDAQ:FFWM – Get Rating) and PCB Bancorp (NASDAQ:PCB – Get Rating) are both small cap finance companies, but which is the better stock? We’ll compare the two companies based on valuation strength, earnings, analyst recommendations, institutional ownership, dividends, risk and profitability.

Risk and Volatility

First Foundation has a beta of 1.24, which means its stock price is 24% more volatile than the S&P 500. In comparison, PCB Bancorp has a beta of 0.77, which means its stock price is 23% less volatile than the S&P 500.

Analyst Notes

This is a summary of current ratings and price targets for First Foundation and PCB Bancorp, as reported by MarketBeat.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
First foundation 0 0 3 0 3.00
BPC Bancorp 0 1 0 0 2.00

First Foundation currently has a consensus target price of $31.00, suggesting a potential upside of 31.58%. PCB Bancorp has a consensus target price of $24.00, suggesting a potential upside of 9.34%. Given First Foundation’s stronger consensus rating and higher likely upside, analysts clearly think First Foundation is more favorable than PCB Bancorp.

Profitability

This table compares the net margins, return on equity and return on assets of First Foundation and PCB Bancorp.

Net margins Return on equity return on assets
First Foundation 34.47% 13.36% 1.33%
BPC Bancorp 40.14% 16.32% 1.92%

Benefits and evaluation

This table compares the revenue, earnings per share and valuation of First Foundation and PCB Bancorp.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
First Foundation $317.67 million 4.19 $109.51 million $2.42 9.74
BPC Bancorp $99.91 million 3.28 $40.10 million $2.62 8.38

First Foundation has higher revenue and profit than PCB Bancorp. PCB Bancorp is trading at a lower price-to-earnings ratio than First Foundation, indicating that it is currently the more affordable of the two stocks.

Dividends

First Foundation pays an annual dividend of $0.44 per share and has a dividend yield of 1.9%. PCB Bancorp pays an annual dividend of $0.60 per share and has a dividend yield of 2.7%. First Foundation pays 18.2% of its profits as a dividend. PCB Bancorp pays 22.9% of its profits as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. First Foundation increased its dividend for 3 consecutive years and PCB Bancorp increased its dividend for 4 consecutive years. PCB Bancorp is clearly the better dividend-paying stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

69.4% of First Foundation’s shares are held by institutional investors. By comparison, 38.2% of PCB Bancorp’s shares are held by institutional investors. 12.6% of First Foundation’s shares are held by insiders. By comparison, 22.5% of PCB Bancorp’s shares are held by insiders. Strong institutional ownership indicates that endowments, large fund managers, and hedge funds believe a stock is poised for long-term growth.

Summary

First Foundation beats PCB Bancorp on 10 out of 17 factors compared between the two stocks.

About First Foundation (Get an assessment)

First Foundation Inc., through its subsidiaries, provides retail, corporate and private wealth management banking services in the United States. It operates through two segments, Banking and Wealth Management. The Company offers a range of bank deposit products, including personal and business checking accounts, savings accounts, interest-bearing negotiable promissory withdrawal accounts, money market accounts and term deposit certificates; and lending products consisting of multi-family and single-family residential real estate loans, commercial real estate loans and commercial term loans and lines of credit, as well as consumer loans, such as personal installment loans and lines of credit , and home equity lines of credit . It also provides various specialized services including trust services, Internet and mobile banking services, remote deposit collection services, merchant credit card services, ATM cards, Visa debit cards and business transfer accounts, as well as insurance brokerage services and equipment financing solutions. In addition, the company offers investment management and financial planning services; cash management services; advisory and coordination services in the field of estate planning, retirement planning, and charitable and corporate ownership matters; and financial, investment and economic advisory and related services. In addition, it provides support services, including the processing and transmission of financial and economic data for charitable organizations. The company operates through a network of 28 branches and 3 loan origination offices in California, Nevada, Texas and Hawaii. First Foundation Inc. was founded in 1985 and is headquartered in Dallas, Texas.

About PCB Bancorp (Get an assessment)

PCB Bancorp operates as a bank holding company for Pacific City Bank which provides various banking products and services to small and medium businesses, individuals and professionals in Southern California. The company offers demand, savings, money market and term deposits, as well as certificates of deposit; and remote deposit capture, courier deposit services, positive pay services, zero balance accounts and transfer accounts. It also offers home loans, including commercial and residential loans, Small Business Administration (SBA) property and construction loans; commercial and industrial loans, such as commercial term loans and lines of credit, SBA commercial term loans and SBA Paycheck Protection Program loans; and other consumer loans including secured auto loans and personal loans. In addition, the Company offers access to account balances, online transfers, online bill payment and electronic delivery of customer statements; and mobile banking solutions that include remote check deposit and mobile bill payment. Additionally, it provides ATMs; and banking by telephone, mail, personal appointment, debit cards, direct deposit and cashier’s checks, as well as cash management, wire transfers and automated clearing house services. The company operates through a network of 11 full-service branches in Los Angeles and Orange Counties, California; and a full-service branch in Englewood Cliffs, New Jersey, and Bayside, New York. It also operates 10 loan production offices in Irvine, Artesia and Los Angeles, California; Annandale, Virginia; Atlanta, Georgia; Chicago, Ill.; Bellevue, Wash.; Aurora, Colorado; Carrollton, Texas; and New York, New York. The company was formerly known as Pacific City Financial Corporation and changed its name to PCB Bancorp in July 2019. PCB Bancorp was founded in 2003 and is headquartered in Los Angeles, California.



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Penny D. Jackson