Prosperity Bancshares (NYSE:PB – Get Free Report) and Private Bancorp of America (OTCMKTS:PBAM – Get Free Report) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, valuation, analyst recommendations, earnings and risk.
Analyst Recommendations
This is a summary of recent ratings and target prices for Prosperity Bancshares and Private Bancorp of America, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Prosperity Bancshares | 0 | 7 | 12 | 0 | 2.63 |
| Private Bancorp of America | 0 | 1 | 1 | 1 | 3.00 |
Prosperity Bancshares presently has a consensus price target of $83.13, suggesting a potential upside of 26.31%. Private Bancorp of America has a consensus price target of $80.00, suggesting a potential upside of 33.89%. Given Private Bancorp of America’s stronger consensus rating and higher possible upside, analysts clearly believe Private Bancorp of America is more favorable than Prosperity Bancshares.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Prosperity Bancshares | $1.79 billion | 3.49 | $479.39 million | $5.50 | 11.97 |
| Private Bancorp of America | $161.24 million | 2.15 | $35.82 million | $7.02 | 8.51 |
Prosperity Bancshares has higher revenue and earnings than Private Bancorp of America. Private Bancorp of America is trading at a lower price-to-earnings ratio than Prosperity Bancshares, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Prosperity Bancshares has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500. Comparatively, Private Bancorp of America has a beta of 0.31, meaning that its stock price is 69% less volatile than the S&P 500.
Insider and Institutional Ownership
80.7% of Prosperity Bancshares shares are held by institutional investors. Comparatively, 13.5% of Private Bancorp of America shares are held by institutional investors. 4.2% of Prosperity Bancshares shares are held 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 Prosperity Bancshares and Private Bancorp of America’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Prosperity Bancshares | 29.37% | 6.99% | 1.33% |
| Private Bancorp of America | 24.17% | 17.81% | 1.68% |
Summary
Prosperity Bancshares beats Private Bancorp of America on 9 of the 15 factors compared between the two stocks.
About Prosperity Bancshares
Prosperity Bancshares, Inc. operates as bank holding company for the Prosperity Bank that provides financial products and services to businesses and consumers. It accepts various deposit products, such as demand, savings, money market, and time accounts, as well as and certificates of deposit. The company also offers 1-4 family residential mortgage, commercial real estate and multifamily residential, commercial and industrial, agricultural, and non-real estate agricultural loans, as well as construction, land development, and other land loans; consumer loans, including automobile, recreational vehicle, boat, home improvement, personal, and deposit account collateralized loans; term loans and lines of credit; and consumer durables and home equity loans, as well as loans for working capital, business expansion, and purchase of equipment and machinery. In addition, it provides internet banking, mobile banking, trust and wealth management, retail brokerage, mortgage services, and treasury management, as well as debit and credit cards. The company was incorporated in 1983 and is headquartered in Houston, Texas.
About Private Bancorp of America
Private Bancorp of America, Inc. operates as the bank holding company for CalPrivate Bank that provides banking products and services to individuals and businesses in California. The company offers checking and savings, money market, certificate of deposit, sweep, zero balance, and individual retirement accounts; unsecured lines of credit, personal credit lines, and term loans; additional services, such as direct deposits, online banking, ATM and debit cards, credit cards, savings/line of credit overdraft protection, and safe deposit boxes; and certificate of deposit account registry services. It also provides treasury management, merchant card, bill pay, positive pay, e-statement, remote deposit capture, ACH origination, wire transfer, electronic payments and collections, electronic check acceptance, account reconciliation, cash vault, and gift and business credit cards, as well as funds management services. In addition, the company offers term credit facilities and loans, equipment and business expansion loans, working capital lines of credit, commercial real estate financing, construction financing, letters of credit, business start-up loans, loans for business acquisition and partner buyouts, owner-occupied commercial real estate loans, equipment, furniture and fixture, and other loans; and CDARS And ICS products. Further, it provides wealth management and legal services. The company has offices in La Jolla, San Diego, Coronado, Newport Beach, Beverly Hills, El Segundo, Temecula, Mission Valley, and Redlands. Private Bancorp of America, Inc. was founded in 2006 and is headquartered in La Jolla, California.
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