Critical Survey: Park National (NYSE:PRK) versus CBB Bancorp (OTCMKTS:CBBI)

Park National (NYSE:PRK) and CBB Bancorp (OTCMKTS:CBBI) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, earnings, institutional ownership and risk.

Dividends

Park National pays an annual dividend of $4.24 per share and has a dividend yield of 2.5%. CBB Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 3.8%. Park National pays out 45.5% of its earnings in the form of a dividend. CBB Bancorp pays out 18.9% 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. CBB Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Park National and CBB Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Park National	23.46%	12.31%	1.50%
CBB Bancorp	18.28%	N/A	N/A

Earnings and Valuation

This table compares Park National and CBB Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Park National	$645.55 million	4.26	$151.42 million	$9.31	18.26
CBB Bancorp	$122.69 million	0.91	$22.43 million	$2.12	5.00

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for Park National and CBB Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Park National	0	2	0	0	2.00
CBB Bancorp	0	0	0	0	0.00

Park National currently has a consensus target price of $154.00, suggesting a potential downside of 9.43%. Given Park National’s stronger consensus rating and higher probable upside, analysts plainly believe Park National is more favorable than CBB Bancorp.

Volatility and Risk

Park National has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500. Comparatively, CBB Bancorp has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500.

Institutional & Insider Ownership

62.7% of Park National shares are owned by institutional investors. 2.7% of Park National shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Park National beats CBB Bancorp on 13 of the 15 factors compared between the two stocks.

About Park National

Park National Corporation operates as the bank holding company for Park National Bank that provides commercial banking and trust services in small and medium population areas. The company offers deposits for demand, savings, and time accounts; trust and wealth management services; cash management services; safe deposit operations; electronic funds transfers; Internet and mobile banking solutions with bill pay service; credit cards; and various additional banking-related services. It also provides commercial loans, including financing for industrial and commercial properties, financing for equipment, inventory and accounts receivable, acquisition financing, and commercial leasing, as well as for consumer finance companies; commercial real estate loans comprising mortgage loans to developers and owners of commercial real estate; originates financing leases primarily for the purchase of commercial vehicles, operating/manufacturing equipment, and municipal vehicles/equipment; consumer loans, such as automobile loans; consumer finance services; home equity lines of credit; and residential real estate and construction loans, as well as installment loans and commercial loans. In addition, the company offers aircraft financing services; and ParkDirect, a personal banking application. Park National Corporation was founded in 1908 and is headquartered in Newark, Ohio.

About CBB Bancorp

CBB Bancorp, Inc. operates as the holding company for Commonwealth Business Bank that provides various commercial banking products and services to individuals and businesses in the United States. It offers checking, savings, money market, and certification of deposit accounts; SBA lending; business lines of credit; business term loans; business and commercial property loans; construction loans; and credit cards. The company also provides treasury management, and mobile and online banking services, as well as title and escrow services. In addition, it engages in investing activities; and offers trade finance services, including commercial letters of credit, standby letters of credit, and documentary collection services. The company offers its services through full-service and limited-service branches in Southern California, Dallas, Texas and Honolulu, and Hawaii; and loan production offices in the states of Colorado, Georgia, Texas, and Washington. CBB Bancorp, Inc. was founded in 2005 and is headquartered in Los Angeles, California.