Pacific Alliance Bank (OTCMKTS:PFBN) vs. OP Bancorp (NASDAQ:OPBK) Critical Review

OP Bancorp (NASDAQ:OPBK) and Pacific Alliance Bank (OTCMKTS:PFBN) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, analyst recommendations, risk, dividends and valuation.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for OP Bancorp and Pacific Alliance Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OP Bancorp	0	2	1	1	2.75
Pacific Alliance Bank	0	0	0	0	0.00

OP Bancorp presently has a consensus price target of $16.50, suggesting a potential upside of 25.28%. Given OP Bancorp’s stronger consensus rating and higher possible upside, research analysts plainly believe OP Bancorp is more favorable than Pacific Alliance Bank.

Profitability

This table compares OP Bancorp and Pacific Alliance Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OP Bancorp	14.42%	11.09%	0.94%
Pacific Alliance Bank	N/A	N/A	N/A

Dividends

OP Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 3.6%. Pacific Alliance Bank pays an annual dividend of $0.10 per share and has a dividend yield of 1.2%. OP Bancorp pays out 30.6% of its earnings in the form of a dividend.

Risk & Volatility

OP Bancorp has a beta of 0.74, indicating that its share price is 26% less volatile than the S&P 500. Comparatively, Pacific Alliance Bank has a beta of 0.21, indicating that its share price is 79% less volatile than the S&P 500.

Institutional & Insider Ownership

53.6% of OP Bancorp shares are held by institutional investors. 20.4% of OP Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares OP Bancorp and Pacific Alliance Bank”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OP Bancorp	$154.05 million	1.27	$21.07 million	$1.57	8.39
Pacific Alliance Bank	$23.57 million	1.15	$1.43 million	N/A	N/A

OP Bancorp has higher revenue and earnings than Pacific Alliance Bank.

Summary

OP Bancorp beats Pacific Alliance Bank on 14 of the 15 factors compared between the two stocks.

About OP Bancorp

OP Bancorp operates as the bank holding company for Open Bank that provides banking products and services in California. It offers demand, checking, savings, money market, and time deposit accounts, as well as certificates of deposit. The company also provides commercial real estate, small business administration, commercial and industrial business, single-family residential, term, consumer, and home mortgage loans; trade financing products; and letters of credit, and SWIFT and export advice. In addition, it offers debit and credit card, online transfer and bill payment, electronic delivery of customer statements, and mobile banking solutions for iPhone and Android phones, including remote check deposit with mobile bill pay; direct deposits, cashier's checks, person to person payments, wire transfers, and automated clearing house (ACH) services; and cash management services, including balance reporting, transfers between accounts, wire transfer initiation, ACH origination, and stop payment services, as well as remote deposit capture, positive pay, zero balance accounts, and sweep accounts. The company operates full branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Gardena, Buena Park, and Santa Clara in California; and Carrollton, Texas; and operates loan production offices in Pleasanton, California; Atlanta, Georgia; Aurora, Colorado; and Lynnwood in Washington. The company was founded in 2005 and is headquartered in Los Angeles, California.

About Pacific Alliance Bank

Pacific Alliance Bank provides commercial and consumer banking products and services for small to midsize business owners, and employees in the United States. It offers checking, money market, savings, and individual retirement accounts; and certificates of deposit. The company also provides mortgage, commercial, term, commercial real estate, construction, and SBA loans; and lines of credit. In addition, it offers personal and business online services; and casher checks, check reorder, night deposit, direct deposit, safe deposit boxes, positive pay/check reconciliation, wire, debit card, and other services. The company was founded in 2006 and is headquartered in San Gabriel, California.