Contrasting California Business Bank (OTCMKTS:CABB) and Independent Bank (NASDAQ:IBCP)

California Business Bank (OTCMKTS:CABB) and Independent Bank (NASDAQ:IBCP) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Analyst Ratings

This is a summary of current ratings and recommmendations for California Business Bank and Independent Bank, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
California Business Bank	0	0	0	0	N/A
Independent Bank	0	4	0	0	2.00

Independent Bank has a consensus price target of $32.17, suggesting a potential downside of 9.31%. Given Independent Bank’s higher possible upside, analysts plainly believe Independent Bank is more favorable than California Business Bank.

Earnings and Valuation

This table compares California Business Bank and Independent Bank”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
California Business Bank	N/A	N/A	N/A	N/A	N/A
Independent Bank	$207.12 million	3.56	$59.07 million	$2.94	12.00

Independent Bank has higher revenue and earnings than California Business Bank.

Profitability

This table compares California Business Bank and Independent Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
California Business Bank	N/A	N/A	N/A
Independent Bank	21.11%	16.90%	1.31%

Risk & Volatility

California Business Bank has a beta of 0.05, meaning that its share price is 95% less volatile than the S&P 500. Comparatively, Independent Bank has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500.

Institutional and Insider Ownership

79.4% of Independent Bank shares are owned by institutional investors. 5.5% of Independent Bank shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Independent Bank beats California Business Bank on 8 of the 8 factors compared between the two stocks.

About California Business Bank

California Business Bank provides various financial products and services for small businesses and entrepreneurs. The company offers various personal and business deposit products; and business and commercial loans comprising SBA, commercial and industrial, and commercial real estate loans. It also provides online and mobile banking, mobile deposit, bill pay, and other services. The company was founded in 2005 and is headquartered in Irvine, California.

About Independent Bank

Independent Bank Corporation operates as the bank holding company for Independent Bank that provides commercial banking services to individuals and businesses in rural and suburban communities in Michigan. It offers checking and savings accounts, commercial lending, direct and indirect consumer financing, mortgage lending, and safe deposit box services. The company also provides title insurance services and investment services, as well as automatic teller machines, and internet and mobile banking services. In addition, it operates through branches, drive-thru facilities, and loan production offices. Independent Bank Corporation was founded in 1864 and is based in Grand Rapids, Michigan.