Critical Comparison: Esquire Financial (NASDAQ:ESQ) & Byline Bancorp (NYSE:BY)

Esquire Financial (NASDAQ:ESQ) and Byline Bancorp (NYSE:BY) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, risk, institutional ownership, dividends, profitability and earnings.

Volatility and Risk

Esquire Financial has a beta of 0.39, indicating that its share price is 61% less volatile than the S&P 500. Comparatively, Byline Bancorp has a beta of 0.75, indicating that its share price is 25% less volatile than the S&P 500.

Valuation and Earnings

This table compares Esquire Financial and Byline Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Esquire Financial	$164.50 million	5.52	$50.82 million	$5.95	17.66
Byline Bancorp	$633.15 million	2.33	$130.05 million	$3.07	10.59

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

Insider and Institutional Ownership

54.7% of Esquire Financial shares are owned by institutional investors. Comparatively, 67.7% of Byline Bancorp shares are owned by institutional investors. 18.0% of Esquire Financial shares are owned by insiders. Comparatively, 28.8% of Byline Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Esquire Financial pays an annual dividend of $0.80 per share and has a dividend yield of 0.8%. Byline Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 1.5%. Esquire Financial pays out 13.4% of its earnings in the form of a dividend. Byline Bancorp pays out 15.6% 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. Esquire Financial has raised its dividend for 4 consecutive years and Byline Bancorp has raised its dividend for 1 consecutive years.

Analyst Ratings

This is a breakdown of current ratings and price targets for Esquire Financial and Byline Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Esquire Financial	0	1	1	2	3.25
Byline Bancorp	0	2	2	0	2.50

Esquire Financial presently has a consensus target price of $120.33, indicating a potential upside of 14.54%. Byline Bancorp has a consensus target price of $34.67, indicating a potential upside of 6.58%. Given Esquire Financial’s stronger consensus rating and higher probable upside, equities analysts plainly believe Esquire Financial is more favorable than Byline Bancorp.

Profitability

This table compares Esquire Financial and Byline Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Esquire Financial	29.96%	18.30%	2.30%
Byline Bancorp	21.86%	11.56%	1.47%

Summary

Esquire Financial beats Byline Bancorp on 11 of the 18 factors compared between the two stocks.

About Esquire Financial

Esquire Financial Holdings, Inc. operates as the bank holding company for Esquire Bank, National Association that provides commercial banking products and services to legal industry and small businesses, and commercial and retail customers in the United States. The company offers checking, savings, money market, and time deposits, as well as certificates of deposit. It also provides commercial loans, such as short-term financing for inventory, receivables, the purchase of supplies, or other operating needs arising during the normal course of business, as well as loans to its qualified ISO customers; commercial lines of credit; consumer loans consisting of post-settlement consumer and structured settlement loans to plaintiffs and claimants, as well as loans to individuals for debt consolidation, medical expenses, living expenses, payment of outstanding bills, or other consumer needs; and real estate loans, such as multifamily, 1-4 family residential, commercial real estate, and construction loans, as well as merchant services. In addition, it offers cash management, cash sweep, online and mobile banking, individual retirement accounts, and working capital lines of credit. Esquire Financial Holdings, Inc. was founded in 2006 and is headquartered in Jericho, New York.

About Byline Bancorp

Byline Bancorp, Inc. operates as the bank holding company for Byline Bank that provides various banking products and services for small and medium sized businesses, commercial real estate and financial sponsors, and consumers in the United States. It offers various retail deposit products, including non-interest-bearing accounts, money market demand accounts, savings accounts, interest-bearing checking accounts, and time deposits; ATM and debit cards; and online, mobile, and text banking services, as well as commercial deposits. The company also provides term loans, revolving lines of credit, and construction financing services; senior secured financing solutions to private equity backed lower middle market companies; small business administration and united states department of agriculture loans; and treasury management products and services. In addition, it offers financing solutions for equipment vendors and their end users; syndication services; and investment, trust, and wealth management services that include fiduciary and executor services, financial planning solutions, investment advisory services, and private banking services for foundations and endowments, and high net worth individuals. The company was formerly known as Metropolitan Bank Group, Inc. and changed its name to Byline Bancorp, Inc. in 2015. Byline Bancorp, Inc. was founded in 1914 and is headquartered in Chicago, Illinois.