Head to Head Analysis: Guaranty Bancshares (NASDAQ:GNTY) vs. CBB Bancorp (OTCMKTS:CBBI)

CBB Bancorp (OTCMKTS:CBBI) and Guaranty Bancshares (NASDAQ:GNTY) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, dividends, analyst recommendations, valuation and risk.

Risk & Volatility

CBB Bancorp has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500. Comparatively, Guaranty Bancshares has a beta of 0.58, indicating that its share price is 42% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for CBB Bancorp and Guaranty Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CBB Bancorp	0	0	0	0	N/A
Guaranty Bancshares	0	2	1	0	2.33

Guaranty Bancshares has a consensus target price of $33.67, indicating a potential upside of 9.27%. Given Guaranty Bancshares’ higher possible upside, analysts clearly believe Guaranty Bancshares is more favorable than CBB Bancorp.

Insider and Institutional Ownership

39.4% of Guaranty Bancshares shares are held by institutional investors. 26.4% of Guaranty Bancshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares CBB Bancorp and Guaranty Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CBB Bancorp	20.08%	N/A	N/A
Guaranty Bancshares	14.48%	8.70%	0.83%

Valuation & Earnings

This table compares CBB Bancorp and Guaranty Bancshares’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CBB Bancorp	$122.26 million	0.87	$28.86 million	$2.59	3.90
Guaranty Bancshares	$115.36 million	3.08	$30.04 million	$2.44	12.63

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

Dividends

CBB Bancorp pays an annual dividend of $0.32 per share and has a dividend yield of 3.2%. Guaranty Bancshares pays an annual dividend of $0.96 per share and has a dividend yield of 3.1%. CBB Bancorp pays out 12.4% of its earnings in the form of a dividend. Guaranty Bancshares pays out 39.3% 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.

Summary

Guaranty Bancshares beats CBB Bancorp on 10 of the 15 factors compared between the two stocks.

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.

About Guaranty Bancshares

Guaranty Bancshares, Inc. operates as the bank holding company for Guaranty Bank & Trust, N.A. that provides a range of commercial and consumer banking products and services for small- and medium-sized businesses, professionals, and individuals. The company offers checking and savings, money market, and business accounts, as well as certificates of deposit; and commercial and industrial, construction and development, 1-4 family residential, commercial real estate, farmland, agricultural, multi-family residential, and consumer loans. It also provides trustee, custodial and escrow, investment management, retirement plan, ATM, night depository, direct deposit, and cashier's check services, as well as online and mobile banking services; debit cards; letters of credit; and treasury management services, including wire transfer, positive pay, remote deposit capture, and automated clearinghouse services. Guaranty Bancshares, Inc. was founded in 1913 and is headquartered in Addison, Texas.