Head-To-Head Comparison: Glacier Bancorp (NYSE:GBCI) vs. Preferred Bank (NASDAQ:PFBC)

Glacier Bancorp (NYSE:GBCI) and Preferred Bank (NASDAQ:PFBC) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, dividends, earnings, risk, analyst recommendations, valuation and institutional ownership.

Analyst Ratings

This is a summary of current recommendations and price targets for Glacier Bancorp and Preferred Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Glacier Bancorp	0	1	0	1	3.00
Preferred Bank	0	2	2	1	2.80

Preferred Bank has a consensus price target of $104.67, indicating a potential upside of 15.97%. Given Preferred Bank’s higher probable upside, analysts plainly believe Preferred Bank is more favorable than Glacier Bancorp.

Institutional & Insider Ownership

80.2% of Glacier Bancorp shares are owned by institutional investors. Comparatively, 72.8% of Preferred Bank shares are owned by institutional investors. 0.5% of Glacier Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

Glacier Bancorp pays an annual dividend of $1.32 per share and has a dividend yield of 3.2%. Preferred Bank pays an annual dividend of $3.00 per share and has a dividend yield of 3.3%. Glacier Bancorp pays out 64.7% of its earnings in the form of a dividend. Preferred Bank pays out 30.5% 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. Preferred Bank has increased its dividend for 5 consecutive years. Preferred Bank is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Glacier Bancorp and Preferred Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Glacier Bancorp	17.52%	7.11%	0.85%
Preferred Bank	25.67%	16.91%	1.82%

Risk and Volatility

Glacier Bancorp has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Preferred Bank has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500.

Earnings and Valuation

This table compares Glacier Bancorp and Preferred Bank”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Glacier Bancorp	$940.55 million	5.15	$190.14 million	$2.04	20.03
Preferred Bank	$280.18 million	4.65	$130.66 million	$9.84	9.17

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

Summary

Preferred Bank beats Glacier Bancorp on 9 of the 17 factors compared between the two stocks.

About Glacier Bancorp

Glacier Bancorp, Inc. operates as the bank holding company for Glacier Bank that provides commercial banking services to individuals, small to medium-sized businesses, community organizations, and public entities in the United States. It offers non-interest bearing deposit and interest bearing deposit accounts, such as negotiable order of withdrawal and demand deposit accounts, savings accounts, money market deposit accounts, fixed rate certificates of deposit, negotiated-rate jumbo certificates, and individual retirement accounts. The company also provides construction and permanent loans on residential real estate; consumer land or lot acquisition loans; unimproved land and land development loans; and residential builder guidance lines comprising pre-sold and spec-home construction, and lot acquisition loans. In addition, it offers commercial real estate loans to purchase, construct, and finance commercial real estate properties; consumer loans secured by real estate, automobiles, or other assets; paycheck protection program loans; home equity loans consisting of junior lien mortgages, and first and junior lien lines of credit secured by owner-occupied 1-4 family residences; and agriculture loans. Further, the company provides mortgage origination and loan servicing services. It has 224 locations, including 188 branches and 36 loan or administration offices in 75 counties within 8 states comprising Montana, Idaho, Utah, Washington, Wyoming, Colorado, Arizona, and Nevada. The company was founded in 1955 and is headquartered in Kalispell, Montana.

About Preferred Bank

Preferred Bank provides various commercial banking products and services to small and mid-sized businesses and their owners, entrepreneurs, real estate developers and investors, professionals, and high net worth individuals. The company accepts checking, savings, and money market deposit accounts; fixed-rate and fixed maturity retail, and non-retail certificates of deposit; and individual retirement accounts. It also provides real estate mortgage loans that are secured by retail, industrial, office, special purpose, and residential single and multi-family properties; real estate construction loans; commercial loans comprising lines of credit for working capital, term loans for capital expenditures, and commercial and stand-by letters of credit; and small business administration loans. In addition, the company offers trade finance services, including commercial and export letters of credit, import lines of credit, documentary collections, international wire transfers, acceptances/trust receipt financing products, export financing, and bills purchase programs. Further, it provides cash management services; and internet, mobile, and tablet banking services. The company operates through full-service branch offices in the California counties of Los Angeles, Orange and San Francisco; Flushing, New York; Houston suburb of Sugar Land, Texas; and a satellite office in Manhattan, New York. The company was incorporated in 1991 and is headquartered in Los Angeles, California.