Comparing Bank7 (NASDAQ:BSVN) and Capital Bancorp (NASDAQ:CBNK)

Bank7 (NASDAQ:BSVN) and Capital Bancorp (NASDAQ:CBNK) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, earnings, risk, valuation, analyst recommendations and institutional ownership.

Valuation and Earnings

This table compares Bank7 and Capital Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank7	$137.26 million	3.83	$43.07 million	$4.37	12.63
Capital Bancorp	$310.06 million	2.03	$57.17 million	$3.40	11.39

Capital Bancorp has higher revenue and earnings than Bank7. Capital Bancorp is trading at a lower price-to-earnings ratio than Bank7, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and price targets for Bank7 and Capital Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank7	1	0	3	0	2.50
Capital Bancorp	0	5	2	0	2.29

Bank7 presently has a consensus price target of $61.67, indicating a potential upside of 11.71%. Capital Bancorp has a consensus price target of $39.67, indicating a potential upside of 2.44%. Given Bank7’s stronger consensus rating and higher possible upside, analysts clearly believe Bank7 is more favorable than Capital Bancorp.

Risk & Volatility

Bank7 has a beta of 0.85, indicating that its stock price is 15% less volatile than the S&P 500. Comparatively, Capital Bancorp has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500.

Dividends

Bank7 pays an annual dividend of $1.20 per share and has a dividend yield of 2.2%. Capital Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 1.4%. Bank7 pays out 27.5% of its earnings in the form of a dividend. Capital Bancorp pays out 16.5% 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. Bank7 has increased its dividend for 5 consecutive years and Capital Bancorp has increased its dividend for 3 consecutive years. Bank7 is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Bank7 and Capital Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank7	30.36%	16.48%	2.18%
Capital Bancorp	17.47%	13.14%	1.46%

Institutional & Insider Ownership

23.5% of Bank7 shares are owned by institutional investors. Comparatively, 56.1% of Capital Bancorp shares are owned by institutional investors. 25.7% of Bank7 shares are owned by insiders. Comparatively, 33.5% of Capital Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Bank7 beats Capital Bancorp on 12 of the 17 factors compared between the two stocks.

About Bank7

Bank7 Corp. operates as a bank holding company for Bank7 that provides banking and financial services to individual and corporate customers. It offers commercial deposit, commercial checking, money market, and other deposit accounts; and retail deposit services, such as certificates of deposit, money market accounts, checking accounts, negotiable order of withdrawal accounts, savings accounts, and automated teller machine access. The company also provides commercial real estate, hospitality, energy, and commercial and industrial lending services; consumer lending services to individuals for personal and household purposes comprising residential real estate loans and mortgage banking services, personal lines of credit, loans for the purchase of automobiles, and other installment loans, as well as secured and unsecured term loans and home improvement loans. It operates through a network of full-service branches in Oklahoma, the Dallas/Fort Worth, Texas metropolitan area, and Kansas. The company was formerly known as Haines Financial Corp. Bank7 Corp. was founded in 1901 and is headquartered in Oklahoma City, Oklahoma.

About Capital Bancorp

Capital Bancorp, Inc. operates as the bank holding company for Capital Bank, N.A. that provides various banking products and services to businesses, not-for-profit associations, and entrepreneurs in Maryland, Virginia, and the District of Columbia. It operates through Commercial Banking, Capital Bank Home Loans, and OpenSky segments. The company offers a range of deposit products, including checking and savings, time, interest bearing and noninterest-bearing demand, and money market accounts, as well as certificates of deposit; and credit cards. It also originates residential mortgages; issues trust preferred securities; and provides residential and commercial real estate, construction, and commercial and industrial loans, as well as other consumer loans, such as term loans, car loans, and boat loans to small to medium-sized businesses, professionals, real estate investors, and small residential builders and individuals. Capital Bancorp, Inc. was founded in 1974 and is headquartered in Rockville, Maryland.