Financial Contrast: Central Pacific Financial (NYSE:CPF) versus University Bancorp (OTCMKTS:UNIB)

University Bancorp (OTCMKTS:UNIB) and Central Pacific Financial (NYSE:CPF) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, profitability, dividends, analyst recommendations, valuation and institutional ownership.

Insider & Institutional Ownership

88.4% of Central Pacific Financial shares are held by institutional investors. 63.7% of University Bancorp shares are held by insiders. Comparatively, 2.7% of Central Pacific Financial shares are held 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.

Earnings and Valuation

This table compares University Bancorp and Central Pacific Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
University Bancorp	$105.57 million	0.78	$5.43 million	N/A	N/A
Central Pacific Financial	$244.08 million	3.14	$58.67 million	$2.05	13.80

Central Pacific Financial has higher revenue and earnings than University Bancorp.

Dividends

University Bancorp pays an annual dividend of $0.45 per share and has a dividend yield of 2.8%. Central Pacific Financial pays an annual dividend of $1.04 per share and has a dividend yield of 3.7%. Central Pacific Financial pays out 50.7% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of recent ratings and price targets for University Bancorp and Central Pacific Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
University Bancorp	0	0	0	0	N/A
Central Pacific Financial	0	0	1	0	3.00

Central Pacific Financial has a consensus target price of $24.00, indicating a potential downside of 15.19%. Given Central Pacific Financial’s higher possible upside, analysts clearly believe Central Pacific Financial is more favorable than University Bancorp.

Profitability

This table compares University Bancorp and Central Pacific Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
University Bancorp	N/A	N/A	N/A
Central Pacific Financial	16.44%	11.36%	0.75%

Volatility and Risk

University Bancorp has a beta of 0.36, suggesting that its stock price is 64% less volatile than the S&P 500. Comparatively, Central Pacific Financial has a beta of 1.13, suggesting that its stock price is 13% more volatile than the S&P 500.

Summary

Central Pacific Financial beats University Bancorp on 11 of the 13 factors compared between the two stocks.

About University Bancorp

University Bancorp, Inc. operates as the bank holding company for University Bank that provides various personal, business, and community banking services in the United States. It offers checking, NOW, savings, money market, time deposit, and certificates of deposit accounts. The company's consumer loans include home equity, short term, automobile, personal, and recreational vehicle loans, as well as home equity lines of credits; SBA, commercial real estate, equipment, home improvement, and other instalment loans; and non-profit loans, as well as working capital lines of credit. In addition, the company provides foreign currency exchange; reverse mortgage; online banking and bill pay; online reorder checks; wire transfer; and courier services, as well as credit card and ATM services. Further, it offers life, health, property, and casualty insurance products, as well as investment products, including annuities. University Bancorp, Inc. was founded in 1890 and is based in Ann Arbor, Michigan.

About Central Pacific Financial

Central Pacific Financial Corp. operates as the bank holding company for Central Pacific Bank that provides a range of commercial banking products and services to businesses, professionals, and individuals in the United States. It offers various deposit products and services, including checking, savings and time deposits, cash management and digital banking, trust, and retail brokerage services, as well as money market accounts and certificates of deposit. The company also provides various lending activities, such as commercial, commercial and residential mortgage, home equity, and consumer loans; and other products and services comprising debit cards, internet and mobile banking, cash management services, full-service ATMs, safe deposit boxes, international banking services, night depository facilities, foreign exchange, and wire transfers. In addition, it offers wealth management products and services that include non-deposit investment products, annuities, insurance, investment management, asset custody and general consultation, and planning services. The company was founded in 1954 and is headquartered in Honolulu, Hawaii.