Head to Head Contrast: First Bank (NASDAQ:FRBA) vs. Five Star Bancorp (NASDAQ:FSBC)

Five Star Bancorp (NASDAQ:FSBC) and First Bank (NASDAQ:FRBA) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Earnings and Valuation

This table compares Five Star Bancorp and First Bank”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Five Star Bancorp	$176.60 million	6.06	$61.61 million	$3.38	12.91
First Bank	$245.83 million	1.82	$43.66 million	$1.69	10.53

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

Institutional & Insider Ownership

46.9% of Five Star Bancorp shares are owned by institutional investors. Comparatively, 64.9% of First Bank shares are owned by institutional investors. 21.8% of Five Star Bancorp shares are owned by insiders. Comparatively, 13.1% of First Bank shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and recommmendations for Five Star Bancorp and First Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Five Star Bancorp	0	3	4	0	2.57
First Bank	0	2	3	0	2.60

Five Star Bancorp presently has a consensus price target of $45.20, suggesting a potential upside of 3.55%. First Bank has a consensus price target of $19.67, suggesting a potential upside of 10.55%. Given First Bank’s stronger consensus rating and higher probable upside, analysts clearly believe First Bank is more favorable than Five Star Bancorp.

Dividends

Five Star Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 2.3%. First Bank pays an annual dividend of $0.36 per share and has a dividend yield of 2.0%. Five Star Bancorp pays out 29.6% of its earnings in the form of a dividend. First Bank pays out 21.3% 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.

Risk and Volatility

Five Star Bancorp has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500. Comparatively, First Bank has a beta of 0.57, indicating that its stock price is 43% less volatile than the S&P 500.

Profitability

This table compares Five Star Bancorp and First Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Five Star Bancorp	25.92%	15.92%	1.45%
First Bank	17.45%	9.57%	1.06%

Summary

Five Star Bancorp beats First Bank on 10 of the 16 factors compared between the two stocks.

About Five Star Bancorp

Five Star Bancorp operates as the bank holding company for Five Star Bank that provides a range of banking products and services to small and medium-sized businesses, professionals, and individuals in Northern California. It accepts various deposits, such as money market accounts, noninterest-bearing and interest checking accounts, savings accounts, term certificate accounts, and time deposits. The company also offers loan products, including commercial and residential real estate loans; commercial loans; commercial land loans; farmland loans; commercial and residential construction loans; and consumer and other loans, as well as operating lines of credit. In addition, it provides debit cards; and remote deposit capture, online and mobile banking, and direct deposit services. Five Star Bancorp was founded in 1999 and is headquartered in Rancho Cordova, California.

About First Bank

First Bank provides various banking products and services to small to mid-sized businesses and individuals. The company accepts various deposits, including non-interest-bearing demand deposits, interest bearing demand accounts, money market accounts, savings accounts, and certificates of deposit, as well as commercial checking accounts. It also offers various loan products comprising commercial and industrial loans, which include line of credit, inventory, equipment, and short-term working capital financing; commercial real estate loans, such as owner-occupied, investor, construction and development, and multi-family loans; residential real estate loans comprising residential mortgages, first and second lien home equity loans, and revolving lines of credit; and consumer and other loans consists of auto, personal, traditional installment, and other loans. The company also provides electronic banking services, including Internet and mobile banking, electronic bill payment, and banking by phone; ATM and debit cards, and wire and ACH transfer services; remote deposit capture; and cash management services, as well as engages in the capital markets activities. It operates full-service branches in Cinnaminson, Delanco, Denville, Ewing, Fairfield, Flemington, Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset, and Williamstown, New Jersey; Doylestown, Trevose, Warminster, and West Chester, Paoli, Malvern, Coventry, Devon, Lionville, and Glen Mills Pennsylvania; and Palm Beach, Florida. First Bank was incorporated in 2007 and is headquartered in Hamilton, New Jersey.