Contrasting MetroCity Bankshares (NASDAQ:MCBS) & CVB Financial (NASDAQ:CVBF)

MetroCity Bankshares (NASDAQ:MCBS) and CVB Financial (NASDAQ:CVBF) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, analyst recommendations, institutional ownership and risk.

Analyst Recommendations

This is a breakdown of current recommendations for MetroCity Bankshares and CVB Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MetroCity Bankshares	0	1	1	0	2.50
CVB Financial	0	1	4	0	2.80

MetroCity Bankshares currently has a consensus price target of $33.00, suggesting a potential downside of 7.04%. CVB Financial has a consensus price target of $26.25, suggesting a potential upside of 16.98%. Given CVB Financial’s stronger consensus rating and higher probable upside, analysts clearly believe CVB Financial is more favorable than MetroCity Bankshares.

Insider and Institutional Ownership

25.3% of MetroCity Bankshares shares are owned by institutional investors. Comparatively, 74.2% of CVB Financial shares are owned by institutional investors. 20.2% of MetroCity Bankshares shares are owned by company insiders. Comparatively, 6.4% of CVB Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares MetroCity Bankshares and CVB Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MetroCity Bankshares	28.40%	15.16%	1.82%
CVB Financial	29.02%	9.21%	1.36%

Volatility & Risk

MetroCity Bankshares has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500. Comparatively, CVB Financial has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500.

Earnings and Valuation

This table compares MetroCity Bankshares and CVB Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MetroCity Bankshares	$246.01 million	4.15	$68.53 million	$2.88	12.33
CVB Financial	$648.47 million	6.09	$209.30 million	$1.45	15.48

CVB Financial has higher revenue and earnings than MetroCity Bankshares. MetroCity Bankshares is trading at a lower price-to-earnings ratio than CVB Financial, indicating that it is currently the more affordable of the two stocks.

Dividends

MetroCity Bankshares pays an annual dividend of $1.16 per share and has a dividend yield of 3.3%. CVB Financial pays an annual dividend of $0.80 per share and has a dividend yield of 3.6%. MetroCity Bankshares pays out 40.3% of its earnings in the form of a dividend. CVB Financial pays out 55.2% 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.

Summary

CVB Financial beats MetroCity Bankshares on 10 of the 16 factors compared between the two stocks.

About MetroCity Bankshares

MetroCity Bankshares, Inc. operates as the bank holding company for Metro City Bank that engages in the provision of banking products and services in the United States. It offers customary banking services, such as consumer and commercial checking accounts, savings, and money market accounts, as well as certificates of deposit. The company also provides commercial and consumer loans, including single family residential loans; construction and development, and owner and non-owner occupied commercial real estate loans; letters of credit; and commercial and industrial loans, residential mortgage loans, and SBA loans. In addition, it offers online banking services, which include access to account balances, online transfers, online bill payment, and electronic delivery of customer statements; mobile banking solutions, such as remote check deposit with mobile bill pay; and automated teller machines and telephone banking services. Further, it provides debit cards for checking customers, direct deposits, and cashier's checks; treasury management services, including wire transfer, automated clearing house, and stop payments services; and cash management deposit products, such as remote deposit capture, positive pay, zero balance accounts, and sweep accounts. The company was founded in 2006 and is headquartered in Atlanta, Georgia.

About CVB Financial

CVB Financial Corp. operates as a bank holding company for Citizens Business Bank, a state-chartered bank that provides banking and financial services to small to mid-sized businesses and individuals. It offers checking, savings, money market, and time certificates of deposit products for business and personal accounts; and serves as a federal tax depository for business customers. The company also provides commercial lending products comprising lines of credit and other working capital financing, accounts receivable lending, and letters of credit; agriculture loans to finance the operating needs of wholesale dairy farm operations, cattle feeders, livestock raisers, and farmers; lease financing services for municipal governments; commercial real estate and construction loans; and consumer financing products, including automobile leasing and financing, lines of credit, credit cards, home mortgages, and home equity loans and lines of credit. In addition, it offers various specialized services, such as treasury management systems for monitoring cash flow, merchant card processing program, armored pick-up and delivery, payroll services, remote deposit capture, electronic funds transfers, wires and automated clearinghouse, and online account access. Further, the company provides trust services, such as fiduciary services, mutual funds, annuities, 401(k) plans, and individual investment accounts. CVB Financial Corp. was founded in 1974 and is headquartered in Ontario, California.