Head-To-Head Analysis: Coastal Financial (NASDAQ:CCB) versus East West Bancorp (NASDAQ:EWBC)

East West Bancorp (NASDAQ:EWBC) and Coastal Financial (NASDAQ:CCB) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

89.5% of East West Bancorp shares are owned by institutional investors. Comparatively, 59.2% of Coastal Financial shares are owned by institutional investors. 0.9% of East West Bancorp shares are owned by company insiders. Comparatively, 13.5% of Coastal Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares East West Bancorp and Coastal Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
East West Bancorp	$4.67 billion	3.79	$1.33 billion	$10.40	12.44
Coastal Financial	$661.22 million	1.11	$46.99 million	($0.28)	-171.61

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

Risk & Volatility

East West Bancorp has a beta of 0.93, suggesting that its stock price is 7% less volatile than the S&P 500. Comparatively, Coastal Financial has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for East West Bancorp and Coastal Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
East West Bancorp	0	4	10	1	2.80
Coastal Financial	2	0	5	0	2.43

East West Bancorp presently has a consensus price target of $144.15, suggesting a potential upside of 11.43%. Coastal Financial has a consensus price target of $91.33, suggesting a potential upside of 90.08%. Given Coastal Financial’s higher probable upside, analysts clearly believe Coastal Financial is more favorable than East West Bancorp.

Profitability

This table compares East West Bancorp and Coastal Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
East West Bancorp	30.45%	16.07%	1.75%
Coastal Financial	-0.53%	-0.80%	-0.08%

Summary

East West Bancorp beats Coastal Financial on 13 of the 15 factors compared between the two stocks.

About East West Bancorp

East West Bancorp, Inc. operates as the bank holding company for East West Bank that provides a range of personal and commercial banking services to businesses and individuals in the United States. The company operates through three segments: Consumer and Business Banking, Commercial Banking, and Other. It accepts various deposit products, such as personal and business checking and savings accounts, money market, and time deposits. The company’s loan products include mortgage and home equity, commercial and residential real estate, working capital lines of credit, construction finance, trade finance, letters of credit, commercial business, affordable housing loans, asset-based lending, asset-backed finance, project finance, loan syndication, and equipment financing, as well as financing services for clients to facilitate their business transactions between the United States and Asia. It also provides various wealth management, treasury management, foreign exchange, and interest rate and commodity risk hedging services; and mobile and online banking services. The company was founded in 1973 and is headquartered in Pasadena, California.

About Coastal Financial

Coastal Financial Corporation operates as the bank holding company for Coastal Community Bank that provides various banking products and services to small and medium-sized businesses, professionals, and individuals in the Puget Sound region in Washington. It accepts a range of deposit products, including demand and savings accounts, time deposits, and money market accounts. The company also offers commercial and industrial loans, such as term loans, commercial lines of credit, capital call lines working capital loans, equipment financing, borrowing base loans, small business administration loans, and other loan products; owner and non-owner-occupied real estate loans, and multi-family residential loans; construction, land, and land development loans; residential real estate loans; and consumer and other loans, including automobile, boat and recreational vehicle, and secured term loans, as well as personal lines of credit, including overdraft protection. In addition, it provides remote deposit capture, online and mobile banking, and direct and reciprocal deposit services; and debit cards. Further, the company offers business accounts and cash management services, including business checking and savings accounts, and treasury services, as well as Banking as a Service (BaaS), a platform that allows broker dealers and digital financial service providers to offer their customers banking services. Coastal Financial Corporation was founded in 1997 and is headquartered in Everett, Washington.