Eagle Bancorp (NASDAQ:EGBN) and Veritex (NASDAQ:VBTX) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, earnings, profitability, valuation and dividends.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Eagle Bancorp and Veritex, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Eagle Bancorp 0 0 4 0 3.00
Veritex 0 0 5 0 3.00

Eagle Bancorp presently has a consensus price target of $69.06, suggesting a potential upside of 42.40%. Veritex has a consensus price target of $34.50, suggesting a potential upside of 55.97%. Given Veritex’s higher probable upside, analysts clearly believe Veritex is more favorable than Eagle Bancorp.

Risk and Volatility

Eagle Bancorp has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, Veritex has a beta of 1.4, meaning that its share price is 40% more volatile than the S&P 500.

Institutional & Insider Ownership

69.6% of Eagle Bancorp shares are held by institutional investors. Comparatively, 73.2% of Veritex shares are held by institutional investors. 7.7% of Eagle Bancorp shares are held by insiders. Comparatively, 4.7% of Veritex shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Eagle Bancorp and Veritex’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Eagle Bancorp $353.41 million 4.71 $100.23 million $3.35 14.48
Veritex $87.13 million 6.14 $15.15 million $0.95 23.28

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

Profitability

This table compares Eagle Bancorp and Veritex’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Eagle Bancorp 31.86% 14.41% 1.85%
Veritex 23.12% 6.83% 1.11%

Summary

Eagle Bancorp beats Veritex on 7 of the 13 factors compared between the two stocks.

About Eagle Bancorp

Eagle Bancorp, Inc. operates as the bank holding company for EagleBank that provides commercial and consumer banking services primarily in the United States. It accepts business and personal checking, NOW, tiered savings, and money market accounts, as well as individual retirement and investment sweep accounts; and time deposits. The company also offers various commercial and consumer lending products comprising commercial loans for working capital, equipment purchases, real estate lines of credit, and government contract financing; asset based lending and accounts receivable financing; construction and commercial real estate loans; business equipment financing; consumer home equity lines of credit, personal lines of credit, and term loans; consumer installment loans, such as auto and personal loans; personal credit cards; residential mortgage loans; and real estate secured loans. In addition, it provides online and mobile banking services; other services, including cash management services, business sweep accounts, lock boxes, remote deposit captures, account reconciliation services, merchant card services, safety deposit boxes, and automated clearing house origination, as well as after-hours depositories and ATM services. Further, it provides commercial and retail insurance products through a referral arrangement. The company serves sole proprietorships, small and medium-sized businesses, partnerships, corporations, non-profit organizations, associations, and individuals, as well as investors. It operates 20 banking offices comprising 6 in Suburban Maryland, 5 in the District of Columbia, and 9 in Northern Virginia. Eagle Bancorp, Inc. was founded in 1997 and is headquartered in Bethesda, Maryland.

About Veritex

Veritex Holdings, Inc. operates as the holding company for Veritex Community Bank that provides various commercial banking products and services to small and medium-sized businesses, and professionals. The company's deposit products include checking, demand, savings, money market, and time deposit accounts, as well as commercial deposit and financial institution money market accounts. Its loan portfolio consists of commercial real estate and general commercial loans, residential real estate loans, construction and land loans, farmland loans, and consumer loans. The company also provides a range of online banking solutions, such as access to account balances, online transfers, online bill payment and electronic delivery of customer statements, and ATMs, as well as banking through telephone, mail, and personal appointment. In addition, it offers debit cards, night depository services, direct deposits, cashier's checks, and letters of credit; treasury management services, including balance reporting, transfers between accounts, wire transfer initiation, automated clearinghouse origination, and stop payments; and cash management deposit products consisting of lockbox, remote deposit capture, positive pay, reverse positive pay, account reconciliation services, zero balance accounts, and sweep accounts. The company operates through 20 branches and 1 mortgage office located in the Dallas-Fort Worth metroplex, as well as 1 branch in the Houston metropolitan area. Veritex Holdings, Inc. was founded in 2009 and is headquartered in Dallas, Texas.

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