Comparing Bank of Marin Bancorp (NASDAQ:BMRC) and Western Alliance Bancorporation (NYSE:WAL)

Bank of Marin Bancorp (NASDAQ:BMRC) and Western Alliance Bancorporation (NYSE:WAL) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, dividends, earnings and risk.

Dividends

Bank of Marin Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 3.9%. Western Alliance Bancorporation pays an annual dividend of $1.68 per share and has a dividend yield of 2.1%. Bank of Marin Bancorp pays out -49.5% of its earnings in the form of a dividend. Western Alliance Bancorporation pays out 19.6% 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. Western Alliance Bancorporation has raised its dividend for 5 consecutive years. Bank of Marin Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Bank of Marin Bancorp and Western Alliance Bancorporation”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of Marin Bancorp	$36.01 million	11.59	-$35.67 million	($2.02)	-12.76
Western Alliance Bancorporation	$5.37 billion	1.64	$969.00 million	$8.59	9.39

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

Profitability

This table compares Bank of Marin Bancorp and Western Alliance Bancorporation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of Marin Bancorp	-18.58%	7.20%	0.78%
Western Alliance Bancorporation	17.03%	13.58%	1.09%

Volatility and Risk

Bank of Marin Bancorp has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500. Comparatively, Western Alliance Bancorporation has a beta of 1.34, indicating that its stock price is 34% more volatile than the S&P 500.

Institutional & Insider Ownership

52.3% of Bank of Marin Bancorp shares are held by institutional investors. Comparatively, 79.2% of Western Alliance Bancorporation shares are held by institutional investors. 5.1% of Bank of Marin Bancorp shares are held by company insiders. Comparatively, 2.7% of Western Alliance Bancorporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and target prices for Bank of Marin Bancorp and Western Alliance Bancorporation, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of Marin Bancorp	2	2	2	0	2.00
Western Alliance Bancorporation	0	4	10	0	2.71

Bank of Marin Bancorp currently has a consensus price target of $28.40, indicating a potential upside of 10.16%. Western Alliance Bancorporation has a consensus price target of $92.93, indicating a potential upside of 15.24%. Given Western Alliance Bancorporation’s stronger consensus rating and higher possible upside, analysts clearly believe Western Alliance Bancorporation is more favorable than Bank of Marin Bancorp.

Summary

Western Alliance Bancorporation beats Bank of Marin Bancorp on 13 of the 17 factors compared between the two stocks.

About Bank of Marin Bancorp

Bank of Marin Bancorp operates as the holding company for Bank of Marin that provides a range of financial services primarily to small to medium-sized businesses, not-for-profit organizations, and commercial real estate investors in the United States. The company offers personal and business checking and savings accounts; and individual retirement, health savings, and demand deposit marketplace accounts, as well as time certificates of deposit, certificate of deposit account registry, and insured cash sweep services. It also provides commercial real estate, commercial and industrial, and consumer loans, as well as construction financing and home equity lines of credit. In addition, the company offers merchant and payroll services; commercial equipment leasing program; payment solutions; treasury management services; credit cards; and mobile deposit, remote deposit capture, automated clearing house, wire transfer, and image lockbox services. Further, it provides wealth management and trust services comprising customized investment portfolio management, financial planning, trust administration, estate settlement, and custody services, as well as 401(k) plan services; and automated teller machines, and telephone and digital banking services. The company was incorporated in 1989 and is headquartered in Novato, California.

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.