Reviewing Coastal Financial (NASDAQ:CCB) and Western Alliance Bancorporation (NYSE:WAL)

Coastal Financial (NASDAQ:CCB) and Western Alliance Bancorporation (NYSE:WAL) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, risk, earnings, dividends, institutional ownership, valuation and profitability.

Volatility and Risk

Coastal Financial has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500. Comparatively, Western Alliance Bancorporation has a beta of 1.34, indicating that its share price is 34% more volatile than the S&P 500.

Earnings & Valuation

This table compares Coastal Financial and Western Alliance Bancorporation”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Coastal Financial	$661.22 million	1.62	$46.99 million	$3.19	22.02
Western Alliance Bancorporation	$5.37 billion	1.63	$969.00 million	$8.59	9.35

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

Profitability

This table compares Coastal Financial and Western Alliance Bancorporation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Coastal Financial	7.35%	10.20%	1.01%
Western Alliance Bancorporation	17.03%	13.58%	1.09%

Insider and Institutional Ownership

59.2% of Coastal Financial shares are held by institutional investors. Comparatively, 79.2% of Western Alliance Bancorporation shares are held by institutional investors. 13.5% of Coastal Financial shares are held by insiders. Comparatively, 2.7% of Western Alliance Bancorporation shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Coastal Financial and Western Alliance Bancorporation, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Coastal Financial	1	1	4	0	2.50
Western Alliance Bancorporation	0	4	10	0	2.71

Coastal Financial presently has a consensus target price of $122.60, suggesting a potential upside of 74.54%. Western Alliance Bancorporation has a consensus target price of $92.93, suggesting a potential upside of 15.76%. Given Coastal Financial’s higher possible upside, equities analysts clearly believe Coastal Financial is more favorable than Western Alliance Bancorporation.

Summary

Western Alliance Bancorporation beats Coastal Financial on 11 of the 14 factors compared between the two stocks.

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.

About Western Alliance Bancorporation

Western Alliance Bancorporation operates as the bank holding company for Western Alliance Bank that provides various banking products and related services primarily in Arizona, California, and Nevada. It operates through Commercial and Consumer Related segments. The company offers deposit products, including checking, savings, and money market accounts, as well as fixed-rate and fixed maturity certificates of deposit accounts; demand deposits; and treasury management and residential mortgage products and services. It also provides commercial and industrial loan products, such as working capital lines of credit, loans to technology companies, inventory and accounts receivable lines, mortgage warehouse lines, equipment loans and leases, and other commercial loans; commercial real estate loans, which are secured by multi-family residential properties, professional offices, industrial facilities, retail centers, hotels, and other commercial properties; construction and land development loans for single family and multi-family residential projects, industrial/warehouse properties, office buildings, retail centers, medical office facilities, and residential lot developments; and consumer loans. In addition, the company provides other financial services, such as internet banking, wire transfers, electronic bill payment and presentment, funds transfer and other digital payment offerings, lock box services, courier, and cash management services. Further, the company holds certain investment securities, municipal and non-profit loans, and leases; invests primarily in low-income housing tax credits and small business investment corporations; and holds certain real estate loans and related securities. Western Alliance Bancorporation was founded in 1994 and is headquartered in Phoenix, Arizona.