CVB Financial (NASDAQ:CVBF) and Northrim BanCorp (NASDAQ:NRIM) Critical Contrast

CVB Financial (NASDAQ:CVBF) and Northrim BanCorp (NASDAQ:NRIM) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, earnings, dividends and risk.

Analyst Recommendations

This is a summary of current ratings for CVB Financial and Northrim BanCorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CVB Financial	0	1	4	0	2.80
Northrim BanCorp	0	2	2	0	2.50

CVB Financial currently has a consensus price target of $26.25, suggesting a potential upside of 14.48%. Northrim BanCorp has a consensus price target of $29.50, suggesting a potential upside of 22.92%. Given Northrim BanCorp’s higher probable upside, analysts clearly believe Northrim BanCorp is more favorable than CVB Financial.

Risk & Volatility

CVB Financial has a beta of 0.68, suggesting that its share price is 32% less volatile than the S&P 500. Comparatively, Northrim BanCorp has a beta of 0.92, suggesting that its share price is 8% less volatile than the S&P 500.

Dividends

CVB Financial pays an annual dividend of $0.80 per share and has a dividend yield of 3.5%. Northrim BanCorp pays an annual dividend of $0.68 per share and has a dividend yield of 2.8%. CVB Financial pays out 53.0% of its earnings in the form of a dividend. Northrim BanCorp pays out 27.5% 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. Northrim BanCorp has raised its dividend for 16 consecutive years.

Insider & Institutional Ownership

74.2% of CVB Financial shares are owned by institutional investors. Comparatively, 66.0% of Northrim BanCorp shares are owned by institutional investors. 6.4% of CVB Financial shares are owned by insiders. Comparatively, 2.4% of Northrim BanCorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares CVB Financial and Northrim BanCorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CVB Financial	$648.47 million	6.22	$209.30 million	$1.51	15.19
Northrim BanCorp	$255.58 million	2.09	$64.61 million	$2.47	9.72

CVB Financial has higher revenue and earnings than Northrim BanCorp. Northrim BanCorp is trading at a lower price-to-earnings ratio than CVB Financial, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares CVB Financial and Northrim BanCorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CVB Financial	29.54%	9.42%	1.41%
Northrim BanCorp	22.02%	16.01%	1.60%

Summary

CVB Financial beats Northrim BanCorp on 10 of the 17 factors compared between the two stocks.

About CVB Financial

CVB Financial Corp. operates as a bank holding company for Citizens Business Bank, a state-chartered bank that provides banking and financial services to small to mid-sized businesses and individuals. It offers checking, savings, money market, and time certificates of deposit products for business and personal accounts; and serves as a federal tax depository for business customers. The company also provides commercial lending products comprising lines of credit and other working capital financing, accounts receivable lending, and letters of credit; agriculture loans to finance the operating needs of wholesale dairy farm operations, cattle feeders, livestock raisers, and farmers; lease financing services for municipal governments; commercial real estate and construction loans; and consumer financing products, including automobile leasing and financing, lines of credit, credit cards, home mortgages, and home equity loans and lines of credit. In addition, it offers various specialized services, such as treasury management systems for monitoring cash flow, merchant card processing program, armored pick-up and delivery, payroll services, remote deposit capture, electronic funds transfers, wires and automated clearinghouse, and online account access. Further, the company provides trust services, such as fiduciary services, mutual funds, annuities, 401(k) plans, and individual investment accounts. CVB Financial Corp. was founded in 1974 and is headquartered in Ontario, California.

About Northrim BanCorp

Northrim BanCorp, Inc. operates as the bank holding company for Northrim Bank that provides commercial banking products and services to businesses and professional individuals. It operates through two segments, Community Banking and Home Mortgage Lending. The company offers noninterest-bearing checking accounts and interest-bearing time deposits, checking and savings accounts, individual retirement and money market deposit accounts, certificates of deposit, and business sweep accounts. It also provides short and medium-term commercial loans, commercial credit lines, construction and real estate loans, and consumer loans, as well as short-term working capital. In addition, the company offers other services comprising consumer and business online banking, mobile app, and mobile deposits; and debit and credit cards. Further, it provides mobile web and app banking, consumer online account opening, personal finance, online documents, consumer debit cards, business debit cards, my rewards for consumer debit cards, retail lockbox, card control, corporate purchase cards, integrated payables, home equity advantage access cards, telebanking, and automated teller services. Additionally, the company offers personalized checks at account opening, overdraft protection from a savings account, commercial drive-up banking, automatic transfer and payment, People Pay, external transfer, Bill Pay, wire transfer, direct payroll deposit, electronic tax payment, Automated Clearing House origination and receipt, remote deposit capture, account reconciliation and positive pay, merchant, cash management, annuity, and long-term investment portfolio products and services. It also provides investment advisory, trust, wealth management, factoring, and mortgage services. The company was founded in 1990 and is headquartered in Anchorage, Alaska.