First Republic Bank (OTCMKTS:FRCB) and VersaBank (NASDAQ:VBNK) Critical Analysis

VersaBank (NASDAQ:VBNK) and First Republic Bank (OTCMKTS:FRCB) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, risk, earnings, institutional ownership, analyst recommendations, profitability and dividends.

Volatility and Risk

VersaBank has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, First Republic Bank has a beta of 1.75, suggesting that its stock price is 75% more volatile than the S&P 500.

Profitability

This table compares VersaBank and First Republic Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
VersaBank	16.24%	11.85%	1.07%
First Republic Bank	N/A	N/A	N/A

Valuation and Earnings

This table compares VersaBank and First Republic Bank”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
VersaBank	$176.45 million	2.51	$31.26 million	$1.30	13.10
First Republic Bank	$6.75 billion	0.00	$1.67 billion	N/A	N/A

First Republic Bank has higher revenue and earnings than VersaBank.

Analyst Ratings

This is a summary of current recommendations and price targets for VersaBank and First Republic Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
VersaBank	0	0	3	1	3.25
First Republic Bank	0	0	0	0	0.00

VersaBank currently has a consensus target price of $19.00, suggesting a potential upside of 11.57%. Given VersaBank’s stronger consensus rating and higher probable upside, equities analysts plainly believe VersaBank is more favorable than First Republic Bank.

Institutional and Insider Ownership

56.9% of VersaBank shares are owned by institutional investors. Comparatively, 0.0% of First Republic Bank shares are owned by institutional investors. 5.3% of VersaBank shares are owned by insiders. Comparatively, 0.7% of First Republic Bank shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

VersaBank beats First Republic Bank on 10 of the 13 factors compared between the two stocks.

About VersaBank

VersaBank provides various banking products and services in Canada and the United States. It offers deposit products, such as web-based chequing accounts, guaranteed investment certificates, registered retirement savings plans, and tax-free savings accounts, as well as deposit insurance products. The company also provides lending services, including point of sale financing that covers purchasing loan and lease receivables from finance companies operating in various industries; commercial banking services comprising commercial real estate, public sector/infrastructure financing, and condominium financing; and residential mortgages. In addition, it offers cybersecurity services. The company was formerly known as Pacific & Western Bank of Canada and changed its name to VersaBank in May 2016. VersaBank was incorporated in 1979 and is headquartered in London, Canada.

About First Republic Bank

As of May 1, 2023, First Republic Bank went out of business. Previously, First Republic Bank provided private banking, private business banking, and private wealth management services to clients in metropolitan areas in the United States. The company was founded in 1985 and was headquartered in San Francisco, California. First Republic Bank now trades on OTCPK.