Central Pacific Financial (NYSE:CPF) and MVB Financial (NASDAQ:MVBF) 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
84.5% of Central Pacific Financial shares are held by institutional investors. Comparatively, 35.2% of MVB Financial shares are held by institutional investors. 3.7% of Central Pacific Financial shares are held by insiders. Comparatively, 17.1% of MVB 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.
This table compares Central Pacific Financial and MVB Financial’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Central Pacific Financial||$258.18 million||2.25||$58.32 million||$2.03||10.15|
|MVB Financial||$146.96 million||1.84||$26.99 million||$2.16||10.63|
Central Pacific Financial has higher revenue and earnings than MVB Financial. Central Pacific Financial is trading at a lower price-to-earnings ratio than MVB Financial, indicating that it is currently the more affordable of the two stocks.
Central Pacific Financial pays an annual dividend of $0.92 per share and has a dividend yield of 4.5%. MVB Financial pays an annual dividend of $0.36 per share and has a dividend yield of 1.6%. Central Pacific Financial pays out 45.3% of its earnings in the form of a dividend. MVB Financial pays out 16.7% 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.
This is a summary of recent ratings and price targets for Central Pacific Financial and MVB Financial, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Central Pacific Financial||0||1||1||0||2.50|
Central Pacific Financial presently has a consensus target price of $15.00, indicating a potential downside of 27.18%. MVB Financial has a consensus target price of $17.50, indicating a potential downside of 23.81%. Given MVB Financial’s stronger consensus rating and higher possible upside, analysts clearly believe MVB Financial is more favorable than Central Pacific Financial.
This table compares Central Pacific Financial and MVB Financial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Central Pacific Financial||15.44%||7.31%||0.62%|
Volatility and Risk
Central Pacific Financial has a beta of 1.32, suggesting that its stock price is 32% more volatile than the S&P 500. Comparatively, MVB Financial has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.
MVB Financial beats Central Pacific Financial on 8 of the 15 factors compared between the two stocks.
Central Pacific Financial Company Profile
Central Pacific Financial Corp. operates as the holding company for Central Pacific Bank that provides commercial banking products and services to businesses, professionals, and individuals in the United States. The company operates in three segments: Banking Operations, Treasury, and All Others. It offers various deposit products and services, including personal and business checking and savings accounts, money market accounts, and time certificates of deposit. The company's lending activities comprise commercial loans, financial and agricultural loans, commercial mortgages, construction loans, and leases to small and medium-sized companies, business professionals, and real estate investors and developers, as well as residential mortgages, home equity, and consumer loans to local homebuyers and individuals. Central Pacific Financial Corp. also provides debit cards, internet and mobile banking, cash management services, traveler's checks, safe deposit boxes, international banking services, night depository facilities, foreign exchange and wire transfers, trust services, retail brokerage, and wholesale funding services. In addition, the company offers wealth management products and services, including non-deposit investment products, annuities, insurance, investment management, asset custody, and general consultation and planning services. As of December 31, 2019, it operated 35 branches and 77 automated teller machines in the state of Hawaii. The company was founded in 1954 and is headquartered in Honolulu, Hawaii.
MVB Financial Company Profile
MVB Financial Corp., together with its subsidiaries, provides banking and mortgage products and services to individuals and corporate clients in the United States. The company operates through three segments: Commercial and Retail Banking; Mortgage Banking; and Financial Holding Company. It offers various demand deposit accounts, savings accounts, money market accounts, and certificates of deposit; and grants various types of loans, including commercial and commercial real estate loans, residential real estate loans, home equity lines of credit, real estate construction loans, and consumer loans. The company also provides debit cards; cashier's checks; safe deposit rental facilities; and non-deposit investment services, as well as automated teller machines, and internet and telephone banking services. The company operates fifteen full-service banking branches; twelve mortgage offices in West Virginia; and three in Virginia. MVB Financial Corp. was founded in 1997 and is headquartered in Fairmont, West Virginia.
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