Hope Bancorp (NASDAQ:HOPE) vs. TriCo Bancshares (NASDAQ:TCBK) Critical Analysis

Hope Bancorp (NASDAQ:HOPE) and TriCo Bancshares (NASDAQ:TCBK) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.

Institutional and Insider Ownership

84.0% of Hope Bancorp shares are owned by institutional investors. Comparatively, 59.1% of TriCo Bancshares shares are owned by institutional investors. 2.3% of Hope Bancorp shares are owned by insiders. Comparatively, 4.9% of TriCo Bancshares shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Hope Bancorp and TriCo Bancshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hope Bancorp	$967.63 million	1.67	$61.59 million	$0.52	24.29
TriCo Bancshares	$538.91 million	3.01	$121.56 million	$3.95	12.86

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

Dividends

Hope Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 4.4%. TriCo Bancshares pays an annual dividend of $1.44 per share and has a dividend yield of 2.8%. Hope Bancorp pays out 107.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TriCo Bancshares pays out 36.5% of its earnings in the form of a dividend. TriCo Bancshares has raised its dividend for 12 consecutive years.

Risk & Volatility

Hope Bancorp has a beta of 0.84, indicating that its share price is 16% less volatile than the S&P 500. Comparatively, TriCo Bancshares has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Hope Bancorp and TriCo Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hope Bancorp	0	3	2	0	2.40
TriCo Bancshares	0	2	4	1	2.86

Hope Bancorp presently has a consensus price target of $14.50, indicating a potential upside of 14.81%. TriCo Bancshares has a consensus price target of $54.60, indicating a potential upside of 7.48%. Given Hope Bancorp’s higher probable upside, research analysts clearly believe Hope Bancorp is more favorable than TriCo Bancshares.

Profitability

This table compares Hope Bancorp and TriCo Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hope Bancorp	6.56%	5.32%	0.65%
TriCo Bancshares	23.71%	9.92%	1.31%

Summary

TriCo Bancshares beats Hope Bancorp on 12 of the 18 factors compared between the two stocks.

About Hope Bancorp

Hope Bancorp, Inc. operates as the bank holding company for Bank of Hope that provides retail and commercial banking services for businesses and individuals in the United States. It accepts personal and business checking, money market, savings, time deposit, and individual retirement accounts. The company also offers loans comprising commercial and industrial loans to businesses for various purposes, such as working capital, purchasing inventory, debt refinancing, business acquisitions, international trade finance, other business-related financing, and loans syndication services; commercial real estate loans; residential mortgage loans; small business administration loans; and consumer loans, such as single-family mortgage, home equity, automobile, credit card, and personal loans. In addition, it provides internet banking and bill-pay, remote deposit capture, lock box, and ACH origination services; treasury management services; foreign currency exchange transactions; interest rate contracts and wealth management services; automated teller machine services; and engages in investment activities. Hope Bancorp, Inc. was founded in 1986 and is headquartered in Los Angeles, California.

About TriCo Bancshares

TriCo Bancshares operates as a bank holding company for Tri Counties Bank that provides commercial banking services to individual and corporate customers. The company accepts demand, savings, and time deposits. It also provides small business loans; real estate mortgage loans, such as residential and commercial loans; consumer loans; mortgage, auto, other vehicle, and personal loans; commercial loans, including agricultural loans; and real estate construction loans. In addition, the company offers treasury management services; credit and debit cards; and other customary banking services, including safe deposit boxes; and independent financial and broker-dealer services. Further, it provides checking, saving, and money market accounts, as well as individual retirement accounts; equipment financing; certificate of deposit account registry service; certificated of deposit; and IntraFi cash service. TriCo Bancshares was founded in 1975 and is headquartered in Chico, California.