Live Oak Bancshares (NYSE:LOB) & City (NASDAQ:CHCO) Head to Head Analysis

City (NASDAQ:CHCO – Get Free Report) and Live Oak Bancshares (NYSE:LOB – Get Free Report) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.

Valuation & Earnings

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

City has higher earnings, but lower revenue than Live Oak Bancshares. Live Oak Bancshares is trading at a lower price-to-earnings ratio than City, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

City has a beta of 0.49, suggesting that its share price is 51% less volatile than the S&P 500. Comparatively, Live Oak Bancshares has a beta of 1.79, suggesting that its share price is 79% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for City and Live Oak Bancshares, as provided by MarketBeat.com.

City presently has a consensus price target of $140.00, indicating a potential downside of 1.05%. Live Oak Bancshares has a consensus price target of $41.75, indicating a potential upside of 22.88%. Given Live Oak Bancshares’ higher possible upside, analysts plainly believe Live Oak Bancshares is more favorable than City.

Institutional and Insider Ownership

72.4% of City shares are held by institutional investors. Comparatively, 64.0% of Live Oak Bancshares shares are held by institutional investors. 1.8% of City shares are held by company insiders. Comparatively, 22.4% of Live Oak Bancshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

City pays an annual dividend of $4.00 per share and has a dividend yield of 2.8%. Live Oak Bancshares pays an annual dividend of $0.12 per share and has a dividend yield of 0.4%. City pays out 43.7% of its earnings in the form of a dividend. Live Oak Bancshares pays out 4.3% 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. City has increased its dividend for 6 consecutive years. City is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

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

Summary

City beats Live Oak Bancshares on 12 of the 18 factors compared between the two stocks.

About City

(Get Free Report)

City Holding Company operates as a holding company for City National Bank of West Virginia that provides various banking, trust, and investment management, and other financial solutions in the United States. The company offers checking, savings, and money market accounts, as well as certificates of deposit and individual retirement accounts. It also provides commercial and industrial loans that consist of loans to corporate and other legal entity borrowers primarily in small to mid-size industrial and commercial companies; commercial real estate loans comprising commercial mortgages, which are secured by nonresidential and multi-family residential properties; residential real estate loans to consumers for the purchase or refinance of residence; first-priority home equity loans; home equity lines of credit; amortized home equity loans; consumer loans that are secured and unsecured by automobiles, boats, recreational vehicles, certificates of deposit, and other personal property; and demand deposit account overdrafts, as well as owner-occupied real estate and construction, land development, and lines of credit. In addition, the company offers mortgage banking services, including fixed and adjustable-rate mortgages, construction financing, land loans, production of conventional and government-insured mortgages, secondary marketing, and mortgage servicing. Further, it provides deposit services for commercial customers comprising treasury management, lockbox, and other cash management services; merchant credit card services; wealth management, trust, investment, and custodial services for commercial and individual customers; and corporate trust and institutional custody, financial and estate planning, and retirement plan services, as well as automated-teller-machine, interactive-teller-machine, mobile banking, interactive voice response systems, and credit and debit card services. City Holding Company was founded in 1957 and is headquartered in Charleston, West Virginia.

About Live Oak Bancshares

(Get Free Report)

Live Oak Bancshares, Inc. operates as the bank holding company for Live Oak Banking Company that provides various commercial banking products and services to individuals, small businesses, and professionals in North Carolina, the United States. 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; wealth and investment management services to high-net-worth individuals and families; investment advisory services to a series of funds focused on providing venture capital to new and emerging financial technology companies; and an on-site restaurant location to company employees and business visitors. Live Oak Bancshares, Inc. was incorporated in 2008 and is headquartered in Wilmington, North Carolina.