Analyzing Republic Bancorp (NASDAQ:RBCAA) and OP Bancorp (NASDAQ:OPBK)

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

Risk and Volatility

Republic Bancorp has a beta of 0.57, indicating that its share price is 43% less volatile than the S&P 500. Comparatively, OP Bancorp has a beta of 0.62, indicating that its share price is 38% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Republic Bancorp and OP Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Republic Bancorp	0	0	1	0	3.00
OP Bancorp	0	0	0	0	N/A

Valuation and Earnings

This table compares Republic Bancorp and OP Bancorp’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Republic Bancorp	$427.52 million	2.26	$90.37 million	$4.60	10.83
OP Bancorp	$135.85 million	1.03	$23.92 million	$1.54	6.10

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

Dividends

Republic Bancorp pays an annual dividend of $1.63 per share and has a dividend yield of 3.3%. OP Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 5.1%. Republic Bancorp pays out 35.4% of its earnings in the form of a dividend. OP Bancorp pays out 31.2% 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. Republic Bancorp has increased its dividend for 23 consecutive years. OP Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

24.4% of Republic Bancorp shares are owned by institutional investors. Comparatively, 53.6% of OP Bancorp shares are owned by institutional investors. 56.6% of Republic Bancorp shares are owned by company insiders. Comparatively, 24.9% of OP Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Republic Bancorp and OP Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Republic Bancorp	21.16%	10.39%	1.46%
OP Bancorp	17.61%	12.85%	1.11%

Summary

Republic Bancorp beats OP Bancorp on 10 of the 15 factors compared between the two stocks.

About Republic Bancorp

Republic Bancorp, Inc. operates as a bank holding company for Republic Bank & Trust Company that provides various banking products and services in the United States. It operates in six segments: Traditional Banking, Warehouse, Mortgage Banking, Tax Refund Solutions, Republic Payment Solutions, and Republic Credit Solutions. The company offers demand, money market accounts, savings, individual retirement accounts, time, brokered, and other certificates of deposit; and retail and commercial mortgage, construction and land development, consumer, aircraft, and marine loans. It also provides credit cards; title insurance and other financial products and services; and private banking, lockbox processing, remote deposit capture, business online banking, account reconciliation, automated clearing house processing, and internet and mobile banking services. In addition, it offers short-term and revolving credit facilities to mortgage bankers through mortgage warehouse lines of credit; mortgage banking; tax refund solutions, which facilitate the receipt and payment of federal and state tax refund products through third-party tax preparers and tax-preparation software providers; payments-related products and services to consumers through third party service providers; and consumer credit products. The company offers its services through full-services banking centers in Kentucky, Indiana, Florida, Ohio, and Tennessee. Republic Bancorp, Inc. was incorporated in 1974 and is headquartered in Louisville, Kentucky.

About OP Bancorp

OP Bancorp operates as the bank holding company for Open Bank that provides banking products and services in California. It offers demand, checking, savings, money market, and time deposit accounts, as well as certificates of deposit. The company also provides commercial real estate, small business administration, commercial and industrial business, single-family residential, term, consumer, and home mortgage loans; trade financing products; and letters of credit, and SWIFT and export advice. In addition, it offers debit and credit card, online transfer and bill payment, electronic delivery of customer statements, and mobile banking solutions for iPhone and Android phones, including remote check deposit with mobile bill pay; direct deposits, cashier's checks, person to person payments, wire transfers, and automated clearing house (ACH) services; and cash management services, including balance reporting, transfers between accounts, wire transfer initiation, ACH origination, and stop payment services, as well as remote deposit capture, positive pay, zero balance accounts, and sweep accounts. The company operates full branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Gardena, Buena Park, and Santa Clara in California; and Carrollton, Texas. It also has loan production offices in Atlanta, Georgia; Aurora, Colorado; and Lynnwood and Seattle in Washington. The company was founded in 2005 and is headquartered in Los Angeles, California.