Pacific Premier Bancorp (NASDAQ:PPBI) and Guaranty Bancorp (NASDAQ:GBNK) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, profitability, analyst recommendations and valuation.

Analyst Ratings

This is a summary of recent ratings for Pacific Premier Bancorp and Guaranty Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pacific Premier Bancorp 0 1 1 0 2.50
Guaranty Bancorp 0 2 1 0 2.33

Pacific Premier Bancorp presently has a consensus price target of $43.00, indicating a potential upside of 52.43%. Guaranty Bancorp has a consensus price target of $34.17, indicating a potential upside of 64.66%. Given Guaranty Bancorp’s higher possible upside, analysts clearly believe Guaranty Bancorp is more favorable than Pacific Premier Bancorp.

Institutional & Insider Ownership

80.3% of Pacific Premier Bancorp shares are held by institutional investors. Comparatively, 72.8% of Guaranty Bancorp shares are held by institutional investors. 4.1% of Pacific Premier Bancorp shares are held by insiders. Comparatively, 13.3% of Guaranty Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Pacific Premier Bancorp and Guaranty Bancorp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pacific Premier Bancorp $479.45 million 3.68 $123.34 million $2.51 11.24
Guaranty Bancorp $159.75 million 3.81 $38.62 million $1.53 13.56

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

Risk & Volatility

Pacific Premier Bancorp has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500. Comparatively, Guaranty Bancorp has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500.

Dividends

Pacific Premier Bancorp pays an annual dividend of $0.88 per share and has a dividend yield of 3.1%. Guaranty Bancorp pays an annual dividend of $0.65 per share and has a dividend yield of 3.1%. Pacific Premier Bancorp pays out 35.1% of its earnings in the form of a dividend. Guaranty Bancorp pays out 42.5% 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. Guaranty Bancorp has raised its dividend for 5 consecutive years. Guaranty Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Pacific Premier Bancorp and Guaranty Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pacific Premier Bancorp 25.76% 8.59% 1.41%
Guaranty Bancorp 28.50% 13.05% 1.45%

Summary

Guaranty Bancorp beats Pacific Premier Bancorp on 9 of the 16 factors compared between the two stocks.

About Pacific Premier Bancorp

Pacific Premier Bancorp, Inc. operates as the bank holding company for Pacific Premier Bank that provides banking services to businesses, professionals, real estate investors, and non-profit organizations. Its deposit products include checking, money market, and savings accounts. The company's loan portfolio comprises commercial business loans, lines of credit, small business administration loans, commercial real estate loans, agribusiness loans, home equity lines of credit, construction loans, farmland, and consumer loans, as well as multi-family residential, one-to-four family real estate, commercial and industrial, and franchise lending; warehouse repurchase facilities; and credit facilities to Home Owners' Associations (HOA) and HOA management companies. It also offers cash management, electronic banking, and online bill payment services. The company conducts business through 33 full-service depository branches in the counties of Orange, Los Angeles, Riverside, San Bernardino, San Diego, San Luis Obispo, and Santa Barbara, California, as well as Clark County, Nevada. Pacific Premier Bancorp, Inc. was founded in 1983 and is headquartered in Irvine, California.

About Guaranty Bancorp

Guaranty Bancorp operates as the bank holding company for Guaranty Bank and Trust Company that provides various banking and other financial services to consumers, and small to medium-sized businesses. The company accepts deposit products, such as demand, interest-bearing demand, NOW, money market, IRA, and time deposits, and savings accounts, as well as certificates of deposit. It also offers loan products, including commercial, commercial and residential real estate, construction, and small business administration loans, as well as installment loans to individuals and other consumer loans that include overdraft protection, lines of credit, and other consumer loans. In addition, the company provides wealth management services comprising private banking, investment management, and trust services. As of December 31, 2017, it operated 32 branches located in Colorado's Front Range consisting of the Denver metropolitan area; and an investment management firms. The company was formerly known as Centennial Bank Holdings, Inc. and changed its name to Guaranty Bancorp in 2008. Guaranty Bancorp was incorporated in 2004 and is headquartered in Denver, Colorado.

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