Community West Bancshares (NASDAQ:CWBC) vs. Hancock Whitney (NASDAQ:HWC) Critical Survey

Community West Bancshares (NASDAQ:CWBC) and Hancock Whitney (NASDAQ:HWC) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Risk and Volatility

Community West Bancshares has a beta of 0.91, suggesting that its stock price is 9% less volatile than the S&P 500. Comparatively, Hancock Whitney has a beta of 1.27, suggesting that its stock price is 27% more volatile than the S&P 500.

Institutional and Insider Ownership

33.8% of Community West Bancshares shares are held by institutional investors. Comparatively, 81.2% of Hancock Whitney shares are held by institutional investors. 11.2% of Community West Bancshares shares are held by insiders. Comparatively, 1.1% of Hancock Whitney shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Community West Bancshares pays an annual dividend of $0.48 per share and has a dividend yield of 2.5%. Hancock Whitney pays an annual dividend of $1.60 per share and has a dividend yield of 2.7%. Community West Bancshares pays out 92.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hancock Whitney pays out 30.3% of its earnings in the form of a dividend. Hancock Whitney is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of current ratings and price targets for Community West Bancshares and Hancock Whitney, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Community West Bancshares	0	1	2	0	2.67
Hancock Whitney	0	2	6	1	2.89

Community West Bancshares presently has a consensus target price of $23.33, indicating a potential upside of 23.33%. Hancock Whitney has a consensus target price of $62.56, indicating a potential upside of 6.23%. Given Community West Bancshares’ higher possible upside, analysts clearly believe Community West Bancshares is more favorable than Hancock Whitney.

Earnings and Valuation

This table compares Community West Bancshares and Hancock Whitney”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Community West Bancshares	$166.83 million	2.15	$7.67 million	$0.52	36.39
Hancock Whitney	$2.06 billion	2.46	$460.82 million	$5.28	11.15

Hancock Whitney has higher revenue and earnings than Community West Bancshares. Hancock Whitney is trading at a lower price-to-earnings ratio than Community West Bancshares, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Community West Bancshares and Hancock Whitney’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Community West Bancshares	4.59%	7.90%	0.78%
Hancock Whitney	22.40%	11.56%	1.32%

Summary

Hancock Whitney beats Community West Bancshares on 14 of the 17 factors compared between the two stocks.

About Community West Bancshares

Community West Bancshares operates as the bank holding company for Community West Bank, N.A. that provides various financial products and services in California. The company offers deposit products, such as checking accounts, savings accounts, money market accounts, and fixed rate and fixed maturity certificates of deposits; and cash management products. It also provides commercial, commercial real estate, consumer, manufactured housing, and small business administration loans, as well as agricultural loans for real estate and operating lines; home equity lines of credit collateralized by residential real estate; single family real estate loans; and installment loans consisting of automobile and general-purpose loans. The company serves small to medium-sized businesses and their owners, professionals, high-net worth individuals, and non-profit organizations. Community West Bancshares was founded in 1989 and is headquartered in Goleta, California.

About Hancock Whitney

Hancock Whitney Corporation operates as the financial holding company for Hancock Whitney Bank that provides traditional and online banking services to commercial, small business, and retail customers. It offers various transaction and savings deposit products consisting of brokered deposits, time deposits, and money market accounts; treasury management services, secured and unsecured loan products including revolving credit facilities, and letters of credit and similar financial guarantees; and trust and investment management services to retirement plans, corporations, and individuals, and investment advisory and brokerage products. The company also provides commercial and industrial loans including real and non-real estate loans; construction and land development loans; and residential mortgages, as well as consumer loans. In addition, it offers commercial finance products to middle market and corporate clients, including leases and related structures; facilitates investments in new market tax credit activities and holding certain foreclosed assets; provides customers access to fixed annuity and life insurance products; and underwriting transactions products, as well as debt and mortgage-related securities. The company was founded in 1899 and is headquartered in Gulfport, Mississippi.